With all the chatter about the fiscal cliff, you may not have heard of a tax change that will take effect on January 1 — and why going to the dentist now may be the right response to it.
If youâ€™re under 65, on January 1 your medical tax deduction rate (including expenses for dental work) will take a big jump from 7.5% of gross income to 10%. (No change for folks 65 and older.)
If youâ€™re like me, your health insurance pays a minimal amount for routine dental work — with most of the dentistâ€™s bill being paid out of your own pocket. And if, God forbid, you should need additional work (filling cavities, etc.), you end up paying for most of that too.
A couple of cleaning visits plus a little extra corrective work can add up to a tidy sum that, when added to other medical expenses, may reach the 7.5% goalpost.
While this handy IRS bulletin spells out the bad news about the changes in medical deductions, it doesnâ€™t explain why the goalpost was moved up to 10%.
The â€śwhyâ€ť involves paying for ObamaCare. This extra tax burden on the middle class is just one of those teensy-weensy things Nancy Pelosi referred to when she said, â€śWe have to pass the bill so you can find out whatâ€™s in it.â€ť
So if youâ€™re under 65 and have been putting off having dental work done, wait no longer — and do NOT accept an appointment in January.
If youâ€™re a dentist, I suggest that you inform your clients about the tax change. (Iâ€™ve noticed optometrists have been encouraging their clients to spend down their health savings accounts in December.) While youâ€™re at it, keep your offices open during the evenings and weekends to accommodate those last-minute clients.
No need to see the dentist? Then ask yourself if youâ€™ve delayed having a physical or other annual medical evaluation. Itâ€™s time to hustle up and do your bit to not pay for Obamacare!
Still need convincing? Consider this: which is more painful, a quick trip to the dentist or writing an unnecessarily large check to Obamaâ€™s taxman?