Medical Expenses That Are Deductible and Nondeductible
HUD Handbook 4350.3 REV-1 — Occupancy Requirements of Subsidized Multifamily Housing Programs · 2026 edition · updated 2026-10-05 · United States
The following are examples of eligible items for medical expense deductions. Please note that this list is not exhaustive.
| Type of Medical Expenses | May Include* |
|---|---|
| Services of recognized health care professionals |
Services of physicians, nurses, dentists, opticians, mental health practitioners, osteopaths, chiropractors, Christian Science practitioners, and acupuncture practitioners |
| Services of health care facilities; laboratory fees, X-rays and diagnostic tests, blood, oxygen |
Hospitals, health maintenance organizations (HMOs), laser eye surgery, out-patient medical facilities, and clinics |
| Alcoholism and drug addiction treatment | |
| Medical insurance premiums | Expenses paid to an HMO; Medicaid insurance payments that have not been reimbursed; long-term care premiums (not prorated) |
| Prescription and nonprescription medicines |
Aspirin, antihistamine only if prescribed by a physician for a particular medical condition |
| Transportation to/ lodging |
Actual cost (e.g., bus fare) or, if driving in a car, a mileage rate based on IRS rules. If the individual is receiving reimbursement for the cost of transportation to/ treatment or the lodging from another source, the cost or mileage is not eligible for the medical expense deduction |
| Medical care of permanently institutionalized family member IF his/ income is included in Annual Income |
|
| Dental treatment | Fees paid to the dentist; x-rays; fillings, braces, extractions, dentures |
| Eyeglasses, contact lenses | |
| Hearing aid and batteries, wheelchair, walker, artificial limbs, Braille books and magazines, oxygen and oxygen equipment |
Purchase and upkeep (e.g., additional utility costs to tenant because of oxygen machine [in properties with tenant paid utilities only]) |
| Attendant care or periodic medical care | Nursing services, assistance animal and its upkeep |
| Payments on accumulated medical bills | Scheduled payments |
- Or any other medically necessary service, apparatus, or medication, as documented by third-party verification.
HUD Occupancy Handbook Exhibit 5-3
8/13
1
Exhibit 5-3
4350.3 REV-1
Some items that may not be included in medical expense deductions are listed below.
| Medical Expenses | May Not Include |
|---|---|
| Cosmetic surgery | Do not include in medical expenses amounts paid for unnecessary cosmetic surgery. This applies to any procedure that is directed at improving the patient’s appearance and does not meaningfully promote the proper function of the body or prevent or treat illness or disease. Procedures such as face-lifts, hair transplants, hair removal (electrolysis), and liposuction generally are not deductible. However, if medical complications, e.g., infections, etc., occur as a result of the procedure that requires medical treatment, the medical treatment expenses would be treated as a medical expense deduction. Amounts paid for cosmetic surgery may be deducted if necessary to improve a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease. |
| Health club dues | Do not include in medical expenses the cost of membership in any club organized for business, pleasure, recreation, or other social purpose, such as health club dues, YMCA dues, or amounts paid for steam baths for general health or to relieve physical or mental discomfort not related to a particular medical condition. |
| Household help | Do not include in medical expenses the cost of household help, even if such help is recommended by a doctor. However, certain expenses paid to a person providing nursing-type services may be deductible as medical costs. |
| Medical savings account (MSA) | Do not deduct as a qualified medical expense amounts contributed to an Archer MSA. |
| Nutritional supplements, vitamins, herbal supplements, natural medicines |
Do not include in medical expenses the cost of nutritional supplements, vitamins, herbal supplements, natural medicines, etc., unless they are recommended in writing by a medical practitioner licensed in the locality where practicing. These items must be recommended as treatment for a specific medical condition diagnosed by a physician or other health care provider licensed to make a diagnosis in the locality where practicing. Otherwise, these items are taken to maintain ordinary good health, and are not for medical care. |
HUD Occupancy Handbook Exhibit 5-3
8/13
2
Exhibit 5-3
4350.3 REV-1
| Medical Expenses | May Not Include |
|---|---|
| Personal use items | Do not include in medical expenses an item ordinarily used for personal, living, or family purposes unless it is used primarily to prevent or alleviate a physical or mental defect or illness. For example, the cost of a wig purchased upon the advice of a physician for the mental health of a patient who has lost all of his or her hair from disease or incontinence supplies can be included with medical expenses |
| Nonprescription medicines | Do not include in medical expenses nonprescription medicines unless they are recommended in writing by a medical practitioner licensed in the locality where practicing. These items must be recommended as treatment for a specific medical condition diagnosed by a physician or other health care provider licensed to make a diagnosis in the locality where practicing. |
HUD Occupancy Handbook Exhibit 5-3
8/13
3
U.S. Department of Housing OMB Approval No. 2502-0204 and Urban Development (exp.03/31/2014) Office of Housing Federal Housing Commissioner
Certification of LongTerm Care Insurance
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