LASIK and Tax Deductions

Lasik Tax Deductions

LASIK surgery to correct eyesight is considered by most accountants to be a legitimate medical expense and the good news it that it can be tax deductible. On a bill which is likely to be anywhere from two to four thousand dollars, that can be a considerable savings on overall taxes paid on income.

In the past, LASIK surgery, which stands for Laser-Assisted in Situ Keratomileusis, has been deemed a gray area under tax law. However it is a surgical procedure to correct a physical defect and therefore cannot be deemed to be cosmetic surgery. Any medical procedure which is for the "treatment, prevention or cure of an ailment affecting the structure or function of the body" is a tax deductible expense. This makes the procedure deductible under section 213, so grab a 1040 form and make your claim! Surprisingly few patients who have LASIK surgery actually make the claim, but this is likely to be out of ignorance rather than for any other reason. Every year LASIK surgery is performed on hundreds of thousands of Americans amounting to a huge sum of money spent on the procedure, which could be tax deductible.

As always with the IRS, there are a few rules to be aware of. Medical expenses can only be deducted from tax if they exceed 7.5% of your adjusted gross income. This is known as the adjusted gross income limitation (AGI) for unreimbursed medical expenses. This means that if you earn $10,000 per year and you spend $1200 on legitimate medical expenses as defined above, you can only deduct $450 from your taxes. The first $750 (7.5%) is not allowed. However, LASIK surgery runs at several thousand dollars, and when added to other legitimate medical expenses including medications, it brings the amount claimable usually well above that 7.5% threshold. Any other bills for surgery, crutches, medications and travel expenses to and from those procedures now fall into the tax deductible bracket. A little tax planning may be beneficial here. If more than one member of the family needs LASIK or other surgery, it is best to do it all in the same tax year. Although the first bill may not be tax-deductible, all the other bills above the 7.5% AGI are. If they were spread over several years, each year they may never exceed the AGI and could not be claimed, but lumped together they can be.

More good news from the IRS while they are in this charitable frame of mind is that travel allowances to and from LASIK surgery are also allowable. As you are unlikely to be driving yourself to and from the doctor's surgery, a taxi fare is reasonable, or at the very least bus fare. Although getting a stamped receipt from the bus driver is not going to happen, keep your ticket as proof of the journey.

You can deduct the cost of paying for hospital meals and lodging if your eye surgery requires an overnight stay. Finally, you can also deduct the cost of LASIK surgery for your spouse and dependant children as an allowable expense, just as you can for the cost of accident, health and long-term care insurance.

As with any tax calculation it is wise to consult your CPA before making any expenses regarding possible tax-deductible expenses. Tax law is a huge and specialized field and the rules change continually. However, knowing your rights can help you to know what is likely to be tax-deductible so you don't pay any more than you have to for your LASIK surgery.

Was your Lasik eye surgery tax deductible? Did you get back money from the government? Let us know in the comments.

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Comments

Wow, I had no idea that Lasik surgery was tax deductible! It would be nice to get some money back for the procedure. Where can I find more information about this? On the IRS's website?