Are Medicare Premiums Tax Deductible? What Retirees Need to Know Before Tax Day
With Tax Day approaching, find out if your Medicare costs qualify—and how to claim hundreds in potential savings on your 2025 return
Key Takeaways
- Medicare premiums are deductible, but only if medical costs exceed 7.5 percent of your income.
- Parts B, D, Advantage, Medigap, copays, dental and vision all qualify.
- HSA funds stay tax-free for medical expenses even after enrolling in Medicare.
We are officially less than a month away from Tax Day on April 15, and many Americans are searching for hidden deductions that can help maximize their potential refund. One place they’re looking? Their healthcare premiums, because, as it turns out, many of them—including Medicare—are tax-deductible. Below, we share what people need to know to claim this deductible, including how to correctly add it to your 2025 tax documents.
What does it mean to be tax-deductible?
A tax deduction is an expense that can lower someone’s total taxable income, which can then lower the overall tax that they owe. Common deductions include charitable donations, having a home office, having dependents and/or contributing to a traditional Individual Retirement Account (IRA).
There are also some less common deductibles. These can include: medical travel costs, student loan interest paid by parents, having to purchase a work uniform and/or if you drive for a charity.
Are Medicare premiums tax-deductible?
According to Whitney Stidom at eHealth, an online health insurance marketplace, “Medicare premiums are tax-deductible for some people, but only if they itemize on their federal return rather than taking the standard deduction, and only for the dollar value of their qualified medical expenses that exceeds 7.5 percent of their adjusted gross income.”
“For younger taxpayers, it may be uncommon to reach that 7.5 percent threshold for medical expenses,” she continues. “But for Medicare beneficiaries living on fixed incomes and with higher medical expenses, they may be more likely to surpass it.”
Currently, tax-deductible Medicare premiums include:
- Medicare Part A (for those who pay premiums, most people don’t for Part A)
- Medicare Part B
- Medicare Part D drug plans
- Medicare Advantage plans
- Medicare Supplement (Medigap) plans
Are Health Savings Accounts tax-deductible?
Along with Medicare, many Americans have some version of a Health Savings Account (HSA), and when it comes to filing taxes, Stidom says that fund can help them save money during tax season.
“For people with a Health Savings Account (HSA), they can save money on a pre-tax or tax-deductible basis for a broad range of qualifying medical expenses, including equipment or supplies, such as hearing aids or specialized services, such as acupuncture or chiropractic care,” she explains. “Many employers offer HSA-eligible health plans. While account holders can no longer make deposits into their HSA after they stop working, the money can still be used to pay for qualifying medical expenses tax-free, even after signing up for Medicare.
Stidom also notes that, “Medicare beneficiaries with money in a Health Savings Account — funds often accumulated from before retiring — can still use those dollars to pay tax-free for medical expenses even when they’re enrolled in Medicare.”
How to file your Medicare tax deduction
To take advantage of the Medicare tax deduction, Stidom says that Americans must “itemize deductions on their federal returns rather than taking the standard deduction, and only the amount of qualified medical expenses—including Medicare premiums–that exceeds 7.5 percent of adjusted gross income is actually deductible.”
She also notes that several medical expenses qualify for a tax deduction. These include:
- Copayments
- Deductibles
- Vision care expenses, including the costs of glasses or contacts
- Dental care expenses
- Over-the-counter medications
- Medical equipment in some cases
- Acupuncture and chiropractic care
To file those deductions, Americans must itemize them on their returns. They also should be prepared to upload receipts or PDFs that prove that they actually purchased or used these services in 2025.
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