Are Medicare premiums tax deductible? Of course yes! Did you know that depending on your Medicare plans and how much premium you pay, you can apply for Tax deductions?
Depending on the type of Medicare plan, your age group and your income, you can avail some deductions. In this article, we will explain the best features of each plan and what amount you can deduct from your tax, depending on the plan you have.
Medicare A covers hospice care and inpatient care. Medicare A reimburses if you require a nursing home. This plan even covers major illnesses as well as geriatric care. If you are not enrolled in social security, the premiums you pay are tax deductible. If you apply for social security, you are not eligible for these tax deductions. Also, if you have worked and paid social security taxes for 10 years, you can avail this plan for free.
Medicare B covers usual doctor’s visit and other issues that are non-threatening in nature. It also covers for both physical and occupational therapy, preventive care and other medical tests. If you are 65 or above, the premiums you pay when you take plan B is entirely tax deductible. You receive a bill for the exact amount you paid as premium at the end of the year, which you have to show when you apply for taxes.
Medicare D also called prescription Medicare, is voluntary and covers the cost of prescription drugs only. Most plans within the Medicare D plan have co-payments and deductibles that need to be met. Deduct the amount you paid for premium as the medical expenses you have incurred.
This plan gives you benefits of both plan A and plan B which means both routine doctor visits and major illness care. It is also called medical advantage plan due to the same reason. Do note, Medicare C is not a separate benefit hence you have to pay an extra premium in addition to Medicare B premiums. Many different plans within plan C exist but if you are 65 or above and not receiving social security benefits, you are eligible for the same.
If you have made any direct payments to Medicare and Social Security, it is 100 percent tax deductible. So next time when somebody asks, “Are Medicare premiums tax deductible?” you know what to say!