The senate allows a bill to give residents permission to deduct medical expenses from their state income taxes in 2024.
The senate allows a bill to give residents permission to deduct medical expenses from their state income taxes in 2024. (Photo: ABC News)
A Bill to Permit Residents to Deduct Medical Expenses from State Income Taxes
According to a published post by Yahoo, senators are left wondering where the funding would come from after they approved a bill allowing state residents to deduct medical expenses from their state income taxes. They also approved another bill to permit Health Care Sharing Ministries which is a faith-based health insurance alternative to operate in the state. The Senate Banking and Insurance Committee approved the income tax bill SB 209.
The bill would allow taxpayers to deduct from their adjusted gross income medical expenses starting January 1, 2024. The original draft did not define medical expenses so changes were made to put clarity. The bill states that medical care expenses would include payments for the diagnosis, cure, mitigation, treatment, or prevention of disease. This would also include payments for treatments affecting any structure or function of the body.
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The senate allows a bill to give residents permission to deduct medical expenses from their state income taxes in 2024. (Photo: The Motley Fool)
The Amount to be Allocated for the Bill
The IRS says that you may deduct only the amount of your total medical expenses that exceed 7.5 % of your adjusted gross income. As of now, there is no clear amount of how much the unreimbursed medical costs might be. The fiscal noted that yearly household out-of-pocket medical costs were about $1, 222. An estimated $103,000 in administrative costs would be for the Fiscal Year 2025 and $95, 000 in subsequent years.
The senate suggested imposing a threshold comparable to the IRS code. There are also concerns about the cost which could pose a successful amendment to exclude insurance premiums from the deductible amount. It was noted that the bill passed in a voice vote but it was reported that not everyone voted for it.
