Last week I picked up a couple near Summerlin. Nice people, retired, been in Vegas maybe twelve years. We started talking about taxes somewhere around Sahara — don’t ask me how we got there, it just happens when you’re driving strangers around at 2pm on a Tuesday.
The husband said something I’ve heard probably a hundred times in this car: “We don’t really worry about deductions. Nevada doesn’t have income tax.”
And look, I get it. I really do. After fifteen years here, I still get a small rush every April knowing I don’t owe the state a dime. No state income tax is one of the genuinely good things about living in Nevada. But that one true thing has become an excuse for a lot of us to stop thinking about taxes entirely. And that’s costing people — real money, every year.
I’m 66. Spent most of my career as a computer engineer, which means I think about systems and numbers the way some people think about sports stats. I notice when something doesn’t add up. And for a lot of Las Vegas retirees, the federal medical expense deduction is the thing that’s not adding up — because they’re not claiming it.
The Nevada Tax Trap Nobody Talks About
Here’s the thing about “Nevada has no income tax.” It’s true for state taxes. Completely irrelevant for federal.
The IRS doesn’t care that you live in Nevada. When you file your federal return, you’re playing by the same rules as someone in California or New York or anywhere else. And one of those rules — one that quietly benefits retirees more than almost any other group — is the medical expense deduction on Schedule A.
Most Las Vegas retirees I know aren’t claiming it. Not because they don’t qualify. Because they’ve mentally filed taxes under “not my problem” since moving here.
What the 7.5% Rule Actually Means in Dollar Terms
The rule is simple enough. The IRS lets you deduct unreimbursed medical expenses that exceed 7.5% of your Adjusted Gross Income. You do this by itemizing on Schedule A.
So let’s say your AGI is $50,000. Multiply that by 7.5% and you get $3,750. That’s your floor. The first $3,750 in medical expenses doesn’t count toward the deduction. Everything above it does.
Now think about what you actually spend on healthcare at 66. Medicare Part B in 2026 is $202.90 a month. That’s $2,434.80 right there, before you’ve seen a single doctor. If you have a Medigap supplement — and most people who’ve been around a while know you probably should — that’s another $150 to $300 a month on top.
We haven’t touched dental yet. Or vision. Or prescriptions.
A lot of people are already past that 7.5% line and don’t know it.
The Expenses That Count (This List Is Longer Than You Think)
When most people hear “medical expense deduction,” they picture hospital bills. That’s a pretty narrow version of what actually qualifies.
Medicare Premiums
Part B, Part D, Medigap — all deductible. This surprises people. They think of insurance premiums as something you just pay, not something you deduct. But if you’re writing a check for Medicare every month, that counts.
Dental and Vision
Original Medicare covers almost none of this, which is one of the things that genuinely frustrates me about the system. So you’re already paying out of pocket for cleanings, crowns, glasses, eye exams. All of it qualifies. Keep the receipts.
Hearing Aids
Fully deductible, including batteries. If you’ve been putting it off, that’s a separate conversation. But at least know the tax piece.
Long-Term Care Insurance
This one catches people off guard. If you’re paying premiums on an LTC policy, those premiums are deductible up to IRS limits based on your age — and those limits went up for 2026. For people between 61 and 70, the deductible amount increased from prior years.
Transportation to Medical Appointments
Every time you drive to the cardiologist, the physical therapist, the dermatologist — you can deduct the mileage at the IRS medical rate. I drive a lot for work already, so I pay attention to this. It adds up over a year of appointments.
Prescriptions
Out-of-pocket costs only. Anything reimbursed by insurance doesn’t count. But what you’re actually paying? Yes.
Something New for 2025 That Most People Haven’t Heard Of
There’s a new federal deduction that took effect for the 2025 tax year that I genuinely didn’t know about until I started digging into this stuff. For people born before January 2, 1961 — which is most of us reading this — there’s an additional $6,000 deduction per person. Married couple filing jointly, that’s $12,000.
Here’s the part that really got my attention: you don’t have to itemize to get it. You can claim it on top of the standard deduction. That’s unusual. Most deductions are either/or — you itemize and get them, or you take the standard deduction and don’t. This one stacks.
There’s a phase-out. If your modified AGI goes above $75,000 (single) or $150,000 (married filing jointly), it starts decreasing. But for a lot of retirees on fixed incomes, that’s not going to be the issue.
Check with your tax person on this one. It’s new enough that not everyone has flagged it yet.
So Should You Itemize or Take the Standard Deduction?
That’s the actual question. For 2025, the standard deduction is $15,000 for single filers and $30,000 for married filing jointly. Seniors 65 and older get an additional bump on top of that.
You can only claim the medical expense deduction if you itemize. So you need to figure out whether your total itemized deductions — medical expenses above the 7.5% floor, mortgage interest if you have any, charitable contributions — add up to more than the standard deduction.
For some retirees, it will. For others it won’t. The only way to know is to actually run the numbers.
Back when I was working as an engineer, the rule was: you can’t optimize what you don’t measure. Pull your receipts. Add up a year’s worth of Medicare premiums, supplement costs, dental bills, prescriptions. Compare that total — after subtracting 7.5% of your AGI — against the standard deduction. Then you’ll know.
Three Things That Cause People to Leave This Money Behind
I’ve talked to enough retirees at this point — in this car and otherwise — that I’ve started to see patterns.
One: The Nevada tax misconception. Already covered it. People think no state income tax means their federal situation is simple too. It doesn’t.
Two: No receipt system. By the time April comes around, they can’t find the dental bills from February. The fix is boring but effective: one folder, physical or digital, where every medical receipt goes immediately. I use a note on my phone. I log the date, the amount, the provider, thirty seconds after I leave the office.
Three: Not counting spouse expenses. All the medical costs you paid for your spouse qualify too, not just your own. A lot of couples are looking at the husband’s expenses or the wife’s expenses but not both together. That’s a significant chunk missing from the calculation.
Free Help Exists, Right Here in the Valley
AARP Tax-Aide has locations throughout the Las Vegas area. Free, IRS-certified volunteers, specifically trained on senior tax situations. They’re not going to miss the medical expense deduction. They actually know what questions to ask.
The IRS VITA program serves lower-income filers at no cost as well.
If you’re paying someone $200 to file a return that misses a deduction you qualified for, that’s a bad deal twice over.
Before You File: What to Pull Together
Here’s what you want in front of you when you sit down to do taxes or meet with someone who’s helping you:
- Your SSA-1099 (Social Security statement)
- Medicare Part B and Part D premium statements
- Medigap or supplement plan premium receipts
- Long-term care insurance premium receipts
- Dental and vision receipts
- Out-of-pocket prescription costs
- Hearing aid purchases
- A mileage log if you’ve been tracking medical trips
- Any hospital or specialist bills you paid out of pocket
Add those up. Subtract 7.5% of your AGI. See what’s left. Compare it to the standard deduction. That comparison is the whole decision.
The Bottom Line
Nevada’s tax situation is genuinely good for retirees. I’m not arguing with that. No state income tax, no tax on Social Security, no tax on IRA withdrawals — it’s a real advantage.
But that advantage exists at the state level. On the federal side, you’re still in the same game as everyone else. And on the federal side, medical expenses are one of the few deductions that actually tilt toward people our age — because we’re the ones spending real money on healthcare every year.
Most of my neighbors aren’t claiming it. Maybe you’re not either. Might be worth finding out.
Frequently Asked Questions
Can I deduct Medicare premiums on my federal tax return?
Yes. Medicare Part B, Part D, and Medigap (Medicare Supplement) premiums are all deductible as medical expenses on Schedule A, as long as your total unreimbursed medical expenses exceed 7.5% of your Adjusted Gross Income and you choose to itemize deductions.
Does Nevada’s no-income-tax status affect my federal medical expense deduction?
No. Nevada’s zero state income tax only applies to your state tax return. Your federal return is filed under the same IRS rules regardless of which state you live in. Federal medical expense deductions are available to all qualifying taxpayers, including Nevada residents.
What is the new $6,000 senior deduction for 2025?
Starting with the 2025 tax year, individuals born before January 2, 1961 may qualify for an additional $6,000 deduction ($12,000 for married couples filing jointly). Unlike most deductions, this one can be claimed on top of the standard deduction — you do not have to itemize to receive it. Income phase-outs apply above $75,000 (single) or $150,000 (married filing jointly).
Do I need to itemize to claim the medical expense deduction?
Yes. The medical expense deduction on Schedule A requires itemizing. You’ll want to compare your total itemized deductions against the standard deduction to determine which approach saves you more. Many retirees with significant Medicare and supplement costs find that itemizing is worthwhile.
Where can I get free tax help in Las Vegas?
AARP Tax-Aide operates multiple locations throughout the Las Vegas valley and provides free, IRS-certified tax assistance for seniors. The IRS VITA program also offers free preparation services for eligible filers. Both are staffed by trained volunteers familiar with senior tax situations.
References
- IRS Topic No. 502 — Medical and Dental Expenses
- Medicare Costs in 2026: What Las Vegas Seniors Need to Know — Las Vegas Medicare
- New Long-Term Care Insurance Premium Deductions for 2026 — ElderLaw Answers
- Tax Deductions for Seniors in 2025 & 2026 — National Tax Reports
- The Ultimate Medical Expense Deductions Checklist — TurboTax
Disclaimer
This article is for informational purposes only and does not constitute professional tax or financial advice. Tax laws change frequently, and individual situations vary. Please consult a qualified tax professional or CPA before making decisions based on this information. The author is not a licensed tax advisor.