Fertility treatment costs can seem daunting, especially if your employer's health insurance does not provide coverage for these procedures - as many do not. There are a handful of states that mandate insurers to cover infertility treatments, for companies with more than 50 employees.
The majority of couples live in a state without a such a mandate, or work for employers with less than 50 employees. If you fall into this category, Uncle Sam is willing to make your cost of infertility procedures more affordable.
Let the IRS Cut Infertility Rates
Un-reimbursed medical expenses such as infertility treatment costs are tax deductible. You can discount infertility procedure prices by offsetting tax savings. You have two options, but one is clearly superior:
Take an itemized medical deduction on your IRS Schedule A. Beware - the first 7.5% of your adjusted gross income will be subtracted from the total of your total un-reimbursed medical expenses to determine your amount of tax savings.
For example, if your adjusted gross income is $100,000 this means no tax savings on the first $7,500 of un-reimbursed medical expenses.
Use a Flexible Spending Account for Bigger Savings
A Healthcare Flexible Spending Account (FSA) allows you to realize tax savings on your very first dollar of infertility treatment costs, plus you may also reduce the amount of State, and FICA taxes you pay.
For example, you are in the 25% federal tax bracket, 5% state income tax bracket, and you pay 7.65% in FICA taxes. You contribute $5,200 to the FSA, and use the funds to settle your infertility treatment costs. You will lower your tax bill by $1,957.
That is a nearly 38% reduction in your cost of IVF, IUI or other treatment. Thank you IRS!
No comments:
Post a Comment