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For example, younger persons who are still working probably arenât on Medicare and are still paying into the system by a rate of 6.2% of their annual earnings. Elderly persons on Medicare can use the IRS tax deduction to reduce their tax burden by claiming costs associated with Medicare payments.
Second, your medical expenses that you paid have to exceed 7.5% of your adjusted gross income. You get to deduct only the amount that is greater than 7.5%. For example, if your income is $10,000, and your medical expenses are $1,000, your deduction is $250.