As attention shifts to the Senate bill’s elimination of the individual mandate in the Affordable Care Act, which could increase the number of uninsured by 13 million, it is important to highlight that the House Republican tax plan also wades into health care, raising taxes on millions of Americans with high medical costs through repeal of the medical expenses deduction.
Those who have chronic or serious illnesses like cancer and diabetes may face a tax increase costing hundreds or even thousands of dollars.
Under current law, a taxpayer is able to deduct their medical expenses if those expenses exceed ten percent of income. In 2015, 8.7 million people deducted an average of $9,726, including 7.2 million with incomes under $100,000 who deducted, on average, $9,075. Under the House GOP tax plan, those deductions would be eliminated.
The medical expense deduction helps provide some relief from huge medical bills that can push a family deep into debt. Nearly half of those who claim it make less than $50,000 and almost three-quarters are over 50 years old.
Losing deductions means higher taxes. For those with incomes under $100,000 and an average deduction of more than $9,000, that translates into a tax increase of at least $1,100.