The deduction that allows people with very high medical costs to shrink their taxable income by subtracting some out-of-pocket medical expenses was a moving target during the congressional debate this fall. Some lawmakers wanted to repeal it, but people with serious illnesses or who need long-term care said that eliminating the tax break would be a serious financial blow.
Congress has come around to their way of thinking, at least for now. The tax bill passed this month preserves and expands it.
Under the new law, people whose unreimbursed medical expenses exceed 7.5 percent of their adjusted gross income can claim a deduction for those expenses in 2017 and 2018. Then it is scheduled to revert to 10 percent for everyone, said Tara Straw, a senior policy analyst at the Center on Budget and Policy Priorities, a nonpartisan research institute in Washington, D.C.
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