Medical Expense Deduction: Update and Action Needed!

Legislation | June 10, 2019 | by Marsha R. Greenfield

LeadingAge, along with  over 50 other consumer and aging services organizations, on June 6 sent letters to the House and Senate supporting H.R. 2073 and S. 110, bi-partisan legislation that makes permanent the 7.5% threshold for the medical expense deduction.

LeadingAge, along with over 50 other consumer and aging services organizations, on June 6 sent letters to the House and Senate supporting legislation that specifically makes permanent the 7.5% threshold for the medical expense deduction. In the House, Representatives Katie Porter and Kenny Marchant have introduced H.R. 2073, and in the Senate, Senators Susan Collins and Maria Cantwell have introduced companion bill S. 110.

As we noted last month, the current threshold is 10%, a result of the Tax Cuts and Jobs Act of 2017.  We fought to preserve the 7.5% threshold for seniors but we were only able to save the lower threshold through tax year 2018.

People 65 and over often have high out-of-pocket medical expenses relative to their income, and thousands will end up paying far higher taxes unless the lower threshold is extended. Residents of life plan communities can use this deduction for a portion of their entry and/or monthly fees that qualify as medical expenses, making this form of medical care in their retirement housing far more affordable for many adults.

We have an open call to action for members and residents urging support for this issue – please contact your member of Congress! Time is critical – the 7.5% threshold expired at the end of 2018 and the 10% threshold is now in effect for 2019.