The honest answer has two halves. Therapy is a medical expense in the eyes of the tax code. Whether that saves you anything depends on a threshold most people never cross.

The short answer: yes, therapy counts — but the deduction is for medical expenses "to the extent that such expenses exceed 7.5 percent of adjusted gross income,"¹ and only if you itemize. The statute allows a deduction for "the expenses paid during the taxable year, not compensated for by insurance or otherwise, for medical care of the taxpayer, his spouse, or a dependent."¹ "Medical care" means amounts paid "for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body," and "for transportation primarily for and essential to medical care."¹ The regulation confines the deduction "strictly to expenses incurred primarily for the prevention or alleviation of a physical or mental defect or illness."² The IRS's own list says it plainly: "You can include in medical expenses amounts you pay for therapy received as medical treatment"; "You can include in medical expenses amounts you pay for psychiatric care"; "You can include in medical expenses payments for psychoanalysis"; and "You can include in medical expenses amounts you pay to a psychologist for medical care."³ Prescribed psychiatric medication, the premiums for a policy that covers medical care, and the miles you drive to sessions — at 21 cents a mile for 2025 — are on the list too.³ California's own statute states a 7.5 percent floor for years before 2021; confirm the current-year floor in the Franchise Tax Board's Schedule CA instructions.⁴

The arithmetic

Three conditions have to line up:

  1. You itemize. The publication "explains the itemized deduction for medical and dental expenses that you claim on Schedule A (Form 1040)."³ If your standard deduction is larger than your itemized total, the therapy deduction does nothing.
  2. You paid it, and insurance did not. Only expenses "not compensated for by insurance or otherwise" count.¹ Copays, coinsurance, the deductible you met, and full private-pay fees count; what the plan paid does not. What is a superbill? →
  3. Your total medical expenses exceed 7.5 percent of AGI. "Generally, you can deduct on Schedule A (Form 1040) only the amount of your medical and dental expenses that is more than 7.5% of your AGI."³ On an AGI of $60,000 the first $4,500 of medical expenses yields nothing; only the excess is deductible.

The 7.5 percent floor was made permanent for federal returns by the Consolidated Appropriations Act, 2021 (Pub. L. 116–260, signed December 2020), which "substituted '7.5 percent' for '10 percent'" in the statute and struck the sunset that had limited the lower floor to years before 2021.¹

What counts

  • Therapy itself — "amounts you pay for therapy received as medical treatment."³ Individual, group, family therapy for a diagnosed condition; the test is medical treatment, not the therapist's title.
  • Psychiatric care and psychoanalysis.³ One exception: "you can't include payments for psychoanalysis that is part of required training to be a psychoanalyst."³
  • Psychologists — "amounts you pay to a psychologist for medical care."³ Psychological testing done to diagnose a condition should fit the statutory word "diagnosis" — our reading, not an IRS listing.¹ What does testing cost? →
  • Medication — "amounts you pay for prescribed medicines and drugs"; "Except for insulin, you can't include in medical expenses amounts you pay for a drug that isn't prescribed."³
  • Getting there — "amounts paid for transportation primarily for and essential to medical care": "bus, taxi, train, or plane fares or ambulance service," or the standard medical mileage rate, "21 cents a mile" for 2025.³
  • Insurance premiums — "insurance premiums you pay for policies that cover medical care," subject to the publication's exceptions.³
  • Meals and lodging at a hospital or similar institution — "the cost of meals and lodging at a hospital or similar institution if a principal reason for being there is to receive medical care."³ Lodging away from home that is "not provided in a hospital or similar institution" is capped at "$50 for each night for each person" and must be "primarily for and essential to medical care" provided "by a doctor in a licensed hospital or in a medical care facility related to or the equivalent of a licensed hospital."¹ ³

What does not

The regulation draws the line at general well-being: "an expenditure which is merely beneficial to the general health of an individual, such as an expenditure for a vacation, is not an expenditure for medical care."² The publication's list of things you cannot include has entries for "health club dues or amounts paid to improve one's general health or to relieve physical or mental discomfort not related to a particular medical condition"; "nutritional supplements, vitamins, herbal supplements, 'natural medicines,' etc., unless they are recommended by a medical practitioner as treatment for a specific medical condition diagnosed by a physician"; and non-prescription drugs.³ By that standard, coaching, apps and retreats that are not treatment of a diagnosed condition are unlikely to qualify — an inference from the regulation, not a listed item. Marriage counselling is not named either way in the publication;³ the statutory test — treatment of a disease — is the one to apply.

HSA and FSA money

Paying for therapy from a health savings account or flexible spending arrangement uses the same definition of medical care, but you cannot also deduct what those accounts paid: "You can't include in medical expenses amounts for which you are fully reimbursed by your flexible spending arrangement if you contribute a part of your income on a pre-tax basis to pay for the qualified benefit," and "You can't include expenses you pay for with a tax-free distribution from your health savings account."³ HSA and FSA for therapy →

California

California's Revenue and Taxation Code section 17241 modifies the federal section "by substituting '7.5 percent' for '10 percent' for taxable years beginning before January 1, 2021."⁴ By its terms it covers only years beginning before 2021. Whether California's floor for later years is 7.5 or 10 percent is not answered by the section's text, and this page does not try to; check the Franchise Tax Board's Schedule CA (540) instructions for the year you are filing.⁴

What to do

  • Keep every receipt and EOB. The deduction is for what you paid, "not compensated for by insurance."¹ What is an EOB? →
  • Log your miles to and from sessions; 21 cents a mile adds up over a year of weekly therapy.³
  • Add up everything medical for the household — dental, vision, prescriptions, premiums you pay after tax — before deciding whether you clear 7.5 percent.³
  • Consider timing. Only expenses "paid during the taxable year" count.¹ If a course of treatment straddles December, the year you pay matters.

Worked example

A woman with an AGI of $70,000 pays $160 a session for weekly therapy her plan does not cover — $8,320 for the year — plus $1,100 in prescribed medication copays and 900 miles of driving to sessions, $189 at 21 cents.³ Her medical total is $9,609. Her floor is 7.5 percent of $70,000, $5,250.¹ ³ If she itemizes, $4,359 is deductible on Schedule A.³ If her standard deduction exceeds her itemized total, none of it changes her tax.

Q&A

Q: My therapist is an LMFT, not a psychologist. Does it still count? A: The publication's entry is "therapy received as medical treatment"; the psychologist entry is one example, not a limit.³ The statutory test is treatment of a disease.¹

Q: Does couples counselling count? A: The publication does not name it.³ Counselling that treats a diagnosed condition of one partner fits the statute; counselling for the relationship as such is harder to fit within "treatment, or prevention of disease."¹ Ask a tax professional.

Q: I paid for my adult child's therapy. Can I deduct it? A: The deduction covers medical care of "the taxpayer, his spouse, or a dependent" — using a broader test than the one for claiming a dependent: the gross-income limit is disregarded, so an adult child with income can still qualify if the other tests are met.¹ ³

Q: Is the deduction worth pursuing? A: Only if you itemize and your household's total medical expenses clear 7.5 percent of AGI.³ For most people with employer coverage they do not; for someone paying privately for weekly therapy on a modest income, they can.

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Sources

  1. 26 U.S.C. §213 — (a) "There shall be allowed as a deduction the expenses paid during the taxable year, not compensated for by insurance or otherwise, for medical care of the taxpayer, his spouse, or a dependent (as defined in section 152 …), to the extent that such expenses exceed 7.5 percent of adjusted gross income"; (d)(1) "The term 'medical care' means amounts paid— (A) for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body, (B) for transportation primarily for and essential to medical care referred to in subparagraph (A) … (D) for insurance … covering medical care referred to in subparagraphs (A) and (B)"; (d)(2) lodging "primarily for and essential to medical care" where the care "is provided by a physician in a licensed hospital (or in a medical care facility which is related to, or the equivalent of, a licensed hospital)," "shall not exceed $50 for each night for each individual"; amendment notes, "Pub. L. 116–260, § 101(a)(1) substituted '7.5 percent' for '10 percent'" and "§ 101(a)(2) struck out subsec. (f)," the former sunset, "shall apply to taxable years beginning after December 31, 2020" — law.cornell.edu.
  2. 26 C.F.R. §1.213-1(e)(1) — (i) "The term medical care includes the diagnosis, cure, mitigation, treatment, or prevention of disease"; (ii) "Deductions for expenditures for medical care allowable under section 213 will be confined strictly to expenses incurred primarily for the prevention or alleviation of a physical or mental defect or illness," and "an expenditure which is merely beneficial to the general health of an individual, such as an expenditure for a vacation, is not an expenditure for medical care" — law.cornell.edu.
  3. IRS Publication 502, Medical and Dental Expenses, "For use in preparing 2025 Returns" — "This publication explains the itemized deduction for medical and dental expenses that you claim on Schedule A (Form 1040)"; "Generally, you can deduct on Schedule A (Form 1040) only the amount of your medical and dental expenses that is more than 7.5% of your AGI"; "Medical care expenses must be primarily to alleviate or prevent a physical or mental disability or illness"; "Psychiatric Care": "You can include in medical expenses amounts you pay for psychiatric care"; "Psychoanalysis": "You can include in medical expenses payments for psychoanalysis"; "Psychologist": "You can include in medical expenses amounts you pay to a psychologist for medical care"; "Therapy": "You can include in medical expenses amounts you pay for therapy received as medical treatment"; "Transportation": "amounts paid for transportation primarily for and essential to medical care," "Bus, taxi, train, or plane fares or ambulance service," and "If you don't want to use your actual expenses for 2025, you can use the standard medical mileage rate of 21 cents a mile"; "Medicines" as quoted; "Insurance Premiums": "You can include in medical expenses insurance premiums you pay for policies that cover medical care"; "Lodging" as quoted, "The amount you include in medical expenses for lodging can't be more than $50 for each night for each person"; "Psychoanalysis" also: "However, you can't include payments for psychoanalysis that is part of required training to be a psychoanalyst"; "Flexible Spending Arrangement" and "Health Savings Accounts" entries as quoted; the dependent rule, under which you can include a person who would be your dependent except that "The person received gross income of $5,200 or more in 2025"; "Health Club Dues" and "Nutritional Supplements" as quoted; the "What Expenses Aren't Includible" list, which includes "Nonprescription Drugs and Medicines" and does not mention marriage counselling — irs.gov.
  4. Cal. Revenue & Taxation Code §17241 — "Section 213(a) of the Internal Revenue Code, relating to allowance of deduction, is modified by substituting '7.5 percent' for '10 percent' for taxable years beginning before January 1, 2021" — california.public.law. The section says nothing about years beginning on or after 1 January 2021; the Franchise Tax Board's Schedule CA instructions for the filing year are the check.

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