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October 29, 2004-
The IRS has released the 2004 version of Publication 502
("Pub. 502"), which taxpayers may use to determine
what medical expenses are deductible on their tax returns.
(Under Code Section 213(a), a taxpayer may claim a deduction
for medical expenses to the extent that the expenses exceed
7.5% of the taxpayer's adjusted gross income.) Changes from
last year's version include the following:
- Medicines and Drugs From Other Countries (new item). The
cost of a prescribed drug brought in (or ordered shipped)
from another country generally would not be a deductible
expense, because only drugs that are imported legally will
qualify. The cost of the prescription drug may be deductible
if the Food and Drug Administration announces that it can
be legally imported by individuals. And the cost of a prescribed
drug that is purchased and consumed in another country is
deductible if the drug is legal both in the other country
and in the U.S.
- Health Savings Accounts (HSAs) (new item). Medical expenses
for which a payment or distribution has been made from an
HSA are not deductible.
- Flexible Spending Account (new item). Medical expenses
that are fully reimbursed by a flexible spending account
(such as a health FSA) are not deductible.
- Transportation (revised item). The standard mileage rate
for use of an automobile to obtain medical care is 14 cents
per mile for 2004.
 http://www.irs.gov/pub/irs-pdf/p502.pdf
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