How does the deduction for extraordinary expenses work in the income tax return?
March 23, 2024 | 40,00 EUR | answered by Tatiana Herrmann
Dear tax consultant,
My name is Alexander Siebert and I am currently preparing my income tax return for the past year. In doing so, I came across the topic of deduction for extraordinary expenses and I am somewhat unsure of how exactly this works.
My situation is as follows: Last year, I had to bear unexpectedly high medical expenses that were not covered by my health insurance. These costs have put a significant strain on my financial situation and I am now wondering if I can claim these expenses in my income tax return.
My concern is that I am not sure what requirements need to be met for extraordinary expenses to be tax deductible. Additionally, I am unsure of the deductible amount and if there is a limit.
Could you please explain to me how the deduction for extraordinary expenses works in the income tax return? What documents do I need to provide and what requirements need to be met? Is there a way to calculate the deductible amount of costs? And if so, is there a limit that I need to consider?
I would be very grateful if you could help me with this question, as I would like to ensure that I take advantage of all possible tax relief.
Thank you in advance for your assistance.
Best regards,
Alexander Siebert
Dear Mr. Siebert,
Thank you for your inquiry regarding the deduction for extraordinary expenses in your income tax return. I understand that unexpectedly high medical costs have burdened your financial situation and you now want to find out if these expenses are tax deductible.
The deduction for extraordinary expenses is a way to claim certain costs that exceed the usual framework and represent a special burden on your finances. Deductible costs include high medical expenses, dental treatments, hospital stays, medications, and therapies that were not covered by your health insurance.
In order to deduct these costs in your income tax return, certain requirements must be met. Firstly, the costs must have actually been incurred and necessary to treat an illness or accident. Additionally, the costs must not have been reimbursed by your health insurance.
To calculate the deductible costs, your total extraordinary expenses are determined first. This includes not only the aforementioned medical costs but also expenses for care, maintenance, accommodation in a nursing home, or costs related to disabilities. A reasonable burden is then subtracted from this sum, which varies depending on your income and marital status. The remaining amount can then be claimed as an extraordinary expense in your income tax return.
However, there is a reasonable burden threshold that varies depending on your individual situation. This threshold is a certain percentage of your total income. Costs exceeding this threshold can be claimed as extraordinary expenses.
To claim the deduction for extraordinary expenses in your income tax return, you will need appropriate evidence such as invoices, receipts, and medical certificates for the incurred costs. It is important that you carefully keep all documents and can present them when needed.
I hope this information helps you and answers your questions regarding the deduction for extraordinary expenses in your income tax return. If you have any further questions or need assistance, I am happy to help.
Best regards,
Tatiana Herrmann
