How did the adjusted gross income (AGI) floor for medical deductions shift between 2025 and 2026?
Executive summary
Available sources show the medical-expense deduction floor remained at 7.5% of adjusted gross income (AGI) for both the 2025 and 2026 tax years; Congress made that 7.5% threshold permanent in the Consolidated Appropriations Act of 2021, and IRS guidance and multiple tax publishers describe medical deductions as exceeding 7.5% of AGI for 2025 (taxes filed in 2026) [1][2][3].
1. What changed — and what didn’t — between 2025 and 2026: the headline
There is no evidence in these sources of a shift from 7.5% to a different AGI floor between 2025 and 2026; tax guidance and reporting repeatedly state that qualified medical expenses are deductible only to the extent they exceed 7.5% of AGI for the 2025 tax year (filed in 2026), and that Congress made that 7.5% floor permanent in the Consolidated Appropriations Act of 2021 [2][1][4].
2. Why 7.5% persists: the legislative anchor
Multiple pieces of reporting cite the Consolidated Appropriations Act of 2021 as the statute that fixed the medical-expense floor at 7.5% going forward, removing the prior uncertainty created by temporary extensions and earlier ACA changes that had raised the floor to 10% for many taxpayers [1][4]. The IRS Publication 502 text likewise instructs taxpayers to deduct only amounts over 7.5% of AGI [2].
3. Practical effect for taxpayers in 2025 vs 2026: the double-hurdle reality
Tax guides emphasize a “double hurdle”: even if medical costs exceed 7.5% of AGI, the taxpayer still only benefits if total itemized deductions surpass the standard deduction for their filing status; several outlets use 2025 examples (filed in 2026) to show how medical expenses must clear 7.5% of AGI and then help push itemized totals above the standard deduction to produce tax savings [1][5][6].
4. Conflicting or alternative items flagged in the record
Some sources briefly suggest nuances or different thresholds in particular circumstances: one article excerpt asserted a 10% threshold in an example and discussed special older-tax rules [7], while other mainstream sources (IRS Publication 502, NerdWallet, TurboTax) consistently use 7.5% for 2025. That conflicting citation [7] appears to represent older messaging or an incorrect example; primary IRS guidance and multiple reputable tax publishers support 7.5% [2][3][6].
5. New laws or proposals to watch — limited but notable claims
One industry blog claimed a broad new “0.5% of AGI” floor for total itemized deductions beginning in 2025 under a law named OBBBA, which would change how itemized benefits (including medical) are treated [8]. That is a significant claim because, if true, it would alter the effective benefit of any category-specific floor; however, tax guidance in the reviewed IRS sources and mainstream tax publishers still describe medical expenses as tied to a 7.5% floor [2][3]. In short: the 0.5% claim appears in one non-governmental analysis and should be cross-checked before assuming it overrides IRS rules [8][2].
6. How taxpayers should interpret year-to-year planning guidance
Practical tax-advice pieces for 2025 stress that taxpayers should plan around a persistent 7.5% medical floor and the higher standard deduction introduced by the Tax Cuts and Jobs Act, meaning many people will get no benefit from itemizing medical costs unless expenses are unusually large [1][5]. Several outlets show numeric examples illustrating when medical bills tip a taxpayer into itemizing [1][5][3].
7. Limitations and gaps in available reporting
Available sources do not mention any definitive IRS notice or statutory change that moved the medical deduction floor away from 7.5% for 2026; they largely repeat that 7.5% is the operative threshold for 2025 (filed in 2026) and beyond per the 2021 law [1][2]. The one source claiming a different year-over-year mechanism (the 0.5% overall floor under OBBBA) is a non-governmental analysis and is not corroborated by the IRS excerpts in this set [8][2].
8. Bottom line for readers and next steps
As of the materials reviewed, the AGI floor for deducting medical expenses stayed at 7.5% for the 2025 tax year (filed in 2026) and, per the cited legislative action, is described as permanent going forward; taxpayers should therefore model medical deductions using 7.5% of AGI but also monitor authoritative IRS updates or formal legislative changes, and verify any media reports (such as the OBBBA/0.5% claim) against IRS guidance before acting [2][1][8].