How has the medical expense deduction threshold changed for 2026 compared to prior years?
Executive summary
The medical-expense deduction floor remains 7.5% of adjusted gross income (AGI) for tax year 2026 — the same percentage that applied in prior recent years after Congress made the 7.5% floor permanent in the Consolidated Appropriations Act of 2021 (see IRS guidance and tax commentary) [1][2]. Multiple tax guides and the IRS Topic No. 502/Publication 502 reiterate that taxpayers may deduct qualifying unreimbursed medical expenses only to the extent they exceed 7.5% of AGI [1][3].
1. What changed — and what didn’t: a quick read
There is no increase in the percentage threshold for the medical‑expense deduction for 2026; the floor stayed at 7.5% of AGI after Congress set that level permanently in the Consolidated Appropriations Act of 2021, and authoritative IRS materials and tax‑advisor guides continue to state the 7.5% rule for 2025 and 2026 [1][2]. Reporting and tax‑prep sites repeat that taxpayers who itemize can deduct only qualifying expenses above 7.5% of AGI [4][5].
2. Why the 7.5% rule matters to taxpayers
A 7.5% AGI floor means only unusually large medical outlays generate a federal deduction: for example, someone with $50,000 AGI must have more than $3,750 in qualifying unreimbursed expenses before any deduction applies (explained in IRS Publication 502 and tax guides) [3][6]. Tax advisors and consumer tax sites emphasize that the high standard deduction under current law also makes it harder for many taxpayers to benefit from itemizing for medical costs [6][7].
3. How this compares to past fluctuations
The 7.5% floor was temporary, then threatened to revert to 10% in earlier years; Congress’s action in the Consolidated Appropriations Act of 2021 made the 7.5% level permanent, ending year‑to‑year uncertainty (tax commentary and guides trace that legislative history) [2][6]. Current materials routinely cite that shift as the key legislative change underpinning 2025 and 2026 guidance [2].
4. What the IRS formally says now
IRS Topic No. 502 and Publication 502 continue to state the rule plainly: eligible medical and dental expenses are deductible to the extent they exceed 7.5% of AGI when you itemize on Schedule A [1][3]. Those IRS sources are the definitive statement taxpayers and preparers will follow when preparing returns for tax years 2025 and 2026 [1][3].
5. Where confusion or proposals still exist
Media and financial outlets note proposals and debates — for example, some lawmakers have proposed expanding or changing medical‑expense tax relief — but current, enacted law for 2026 retains the 7.5% floor; reporting about potential future bills does not change the 2026 rule (Kiplinger and other outlets discuss proposals while reiterating the existing 7.5% threshold) [8]. Available sources do not mention any enacted change to the 7.5% threshold for 2026 beyond reiteration of the permanent floor (not found in current reporting).
6. Practical takeaways for taxpayers
If you expect substantial out‑of‑pocket medical costs, keep careful records and calculate whether your qualifying expenses exceed 7.5% of AGI before choosing to itemize; tax‑prep guides and IRS publications walk through which expenses qualify and how to report them on Schedule A [3][5]. Also remember state tax rules may differ — several sources caution that some states use lower thresholds or separate rules [4].
Limitations and sources: This summary relies on IRS Topic No. 502, Publication 502, and contemporary tax‑guide reporting that reiterate Congress’s 2021 decision to fix the 7.5% AGI floor and apply it for 2025 and 2026 [1][3][2]. If you need a ruling applied to a specific set of facts, consult a tax professional or the full IRS Revenue Procedure tables for 2026 adjustments (available sources do not mention a different enacted percentage for 2026) [9][1].