Medical expenses come with tax benefits. Here’s how to maximize yours this year

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Before the calendar flips to 2020, you might want to see if there are some moves you can make to take advantage of the tax breaks for medical expenses.

Experts say it’s worth exploring, as the cost of health care continues its upward climb. The U.S. spent about $3.5 trillion on health care in 2017, or about $11,000 per person. By 2027, that outlay is expected to climb to $6 trillion, or about $17,000 per person, according to the Centers for Medicare and Medicaid Services.

Additionally, Fidelity Investments estimates that the average couple turning 65 in 2019 will spend $285,000 on health care during the remainder of their lives.
The three most common planning opportunities for health-care costs involve flexible spending accounts, health savings accounts and the tax deduction for medical expenses.

The flex-spending factor

If you have a health flexible spending account, or FSA, at work, your pre-tax contributions generally come with a use-it-or-lose-it provision when the year ends.

“Definitely use your FSA first to pay for expenses because it doesn’t carry over year to year,” said CPA Brooke Salvini, a member of the American Institute of CPAs’ Personal Financial Planning Executive Committee.

While many employers provide either a grace period of up to 2½ extra months to use the funds for eligible medical expenses or allow you to carry over $500 to the next year, it’s important to make sure you don’t end up forfeiting that tax-advantaged money…Read more>>

Source:-cnbc