For 2012, medical expenses can be deducted (as an itemized deduction) only to the extent that total out-of-pocket expenses exceed 7.5% of adjusted gross income. Starting in 2013, this threshold is 10%. This was one of the many tax-related provisions in the health care reform package passed back in 2010.
There’s a wide variety of expenditures than can qualify for the medical tax deduction, including health insurance premiums for individual coverage (that is, not through an employer’s group plan), co-payments for prescription medication and doctor’s visits, dental care, and eye care. Some additional medical expenses that can be deducted: travel to and from medical care, hearing aids and laser surgery to correct vision.
A full list of expenses that qualify for the medical deduction in found in Publication 502 on the IRS Web site.