The Legal Advice of Advocates Can be Handy
A well-planned approach to medical insurance can be useful in saving income taxes for people of all ages, including senior citizens. If you use the services of a taxation attorney, provisions of the Finance Act and the Income Tax act to claim relevant benefits will become evident. At the same time, income tax return filing becomes a hassle-free task. People paying for medical insurance for their parents must also get to know about these vital statutes.
Use online tools
You can use facilities provided by the income tax department’s website to assess total exemptions. Ideally, you should do it before you hire a taxation attorney for filings. You should remember that your income in a specific FY must be well-established for its computation in the AY. You must keep all relevant documents regarding the payment of premiums. In case, you don’t have the requisite evidence of payment, and you will not be eligible to get the tax benefits.
Do some research
Section 80 D of the Income Tax Act provides for these exemptions. It will be a smart ploy to read this provision if you want to understand the relevant details properly. A thorough reading of section 80, C of the IT Act will also be extremely beneficial. However, if you are confused about the meaning and implication of these laws, then you must listen carefully to the advice of your lawyer.
Age of The Parents Matters
The total exemption that you get depends on the age of your parents. If one of your parents are above sixty, you can claim a total exemption of Rs. 75,000. In this case, the benefits for the parent above sixty is Rs. 50,000. For other members of the family, your deductions will be limited to Rs. 25,000.
In case none of your parents are above sixty, and you can’t claim more than Rs. 50,000 deduction. Out of the Rs. 50,000, half will be for your parents, and the remaining sum will be for other family members. In case, two people in your family are aged more than sixty, and you can seek a reduction to the tune of Rs. 1,00,000 in your income tax filings.
Medical Expenses for Seniors Can Pile Up
Life can be difficult for people above the age of sixty. Insurance companies demand higher premiums because their life expectancy isn’t substantial. However, during this phase of their life that the need for medical care becomes imminent. Check Here – about health care expenses after retiremnt.
Who is paying the bills?
The best thing about 80 D of the IT Act is that it can provide deductions not only to the senior citizens but also to their children. If you are paying medical insurance premiums or handling medical expenses for your parents, you will be eligible to claim reduction. In case your parents are paying for these expenses, they can also request the same benefits.
The terms and conditions
All taxpayers should know that if they want deductions based on expenses, then the patient mustn’t be a beneficiary of health insurance. You can’t avail dual benefits based on insurance premiums as well as medical expenditure.
For family only
The deductions can’t be claimed if you are paying for health insurance or medical expenditure of your relatives. You can become a beneficiary under 80 D of IT Act only when you are handling the expenses incurred on the medical care of your parents, spouse, or children.
What is medical expenditure?
Using the provisions of the Finance Act are essential to understand all aspects of medical expenses. It is important to note that the money you pay doctors as their fee can also be considered medical expenditure for taxation purposes.
The nature of the disease
Analysis of section 80 DDB of the IT Act is also crucial to the overall scheme of things. It doesn’t cover all diseases, but if you want to claim further deductions after using 80 D, then 80 DDB can come in handy. Under, 80 DDB, you can’t seek a more significant reduction in taxes on expenses for all diseases. The illness must be mentioned in this section.