Paul's $23,000 alimony deduction works as an adjustment to income, while medical expenses follow a different rule.

Tax rules can feel fussy, but they’re really about money that lands in your pocket or stays in it. Here’s a straightforward look at how two common items—alimony and medical expenses—are treated on the tax return, using a simple story about Paul. The bottom line: in Paul’s case, the adjustment to income is $23,000.

Alimony vs. medical expenses: two different gears

• Alimony: a potential adjustment to income

• Medical expenses: a potential itemized deduction on Schedule A

Think of it like two gears on a bicycle. One gear (alimony) can directly reduce your starting point, your gross income. The other gear (medical expenses) influences your final tax bill only after you decide to itemize and only to the extent they exceed a floor of AGI.

Let me explain with Paul’s setup

Paul is paying alimony as part of a divorce agreement that was executed before 2019. This is a critical detail. In this setup, alimony payments are generally deductible by the payer from their taxable income. That means if Paul pays $23,000 in alimony, he can typically reduce his gross income by that entire amount.

Now, what about medical expenses? They’re a different story. Medical expenses aren’t an adjustment to income. They’re itemized deductions, reported on Schedule A, and they’re deductible only to the extent they exceed a certain percentage of the taxpayer’s adjusted gross income (AGI). The threshold percentage has shifted a bit over the years, but the key idea is the same: you only get to deduct the portion that goes beyond that floor, not the whole bill. In practice, that means you itemize the medical costs and then subtract the floor before it ever touches your tax rate calculation.

In Paul’s case, the alimony payment is the direct adjustment. The medical expenses—while still potentially deductible—don’t add to the adjustment to income. They contribute to itemized deductions, but only the portion above the AGI floor reduces your taxable amount after AGI is determined.

Why this distinction matters

• If you’re the payer and the agreement is pre-2019, alimony can lower your AGI. That’s a direct, upfront cut to the amount of income that’s taxed.

• Medical costs are a “second step” deduction. They don’t reduce your AGI; they reduce your taxable income only after you’ve decided to itemize and only if they surpass the floor.

• The two items serve different financial purposes. In many cases, people with higher medical costs also have other deductions or credits, so they’ll weigh whether itemizing makes sense versus taking the standard deduction.

Applying Paul’s numbers: why $23,000 is the number that matters

If Paul has paid $23,000 in alimony under a pre-2019 agreement, that amount sits squarely as an adjustment to income. It reduces Paul’s gross income by $23,000, before AGI is calculated. So from a practical standpoint, that’s the deductible amount for the alimony as an adjustment to income.

Medical expenses, meanwhile, aren’t lumped into that $23,000 figure. They’ll show up on Schedule A, and only the portion that exceeds the threshold of AGI will be deductible as an itemized deduction. The threshold is a percentage of AGI (often around 7.5% in recent years, though you should check the exact year you’re filing). If Paul’s medical bills are high enough to clear that floor, the amount beyond the floor reduces his taxable income further—but it’s separate from the alimony adjustment.

A quick mental model

• Alimony deduction (adjustment to income): works like a direct subtracted line from gross income. If you pay it, you can claim it as an adjustment (assuming the pre-2019 rule applies). In Paul’s example, that’s the full $23,000.

• Medical expense deduction (itemized): works like a pie you’ll slice after you decide to itemize. The slice you can take is the portion of medical costs that exceeds the AGI floor, and it goes on Schedule A, not into the adjustment to income.

What this means for a real-life return

• If you’re a taxpayer who’s paying alimony under a pre-2019 agreement, you’ll want to confirm the terms of the agreement and whether the alimony is indeed deductible at the adjustment-to-income level for your filing year.

• If you’re itemizing medical expenses, gather receipts and bills and compare those costs to the AGI floor. If the total medical costs exceed the floor, you’ll include the excess on Schedule A along with other allowable itemized deductions.

A few practical tips that often come up

• Keep the documentation tidy. For alimony, you’ll want the divorce agreement and proof of payments. For medical expenses, save receipts, prescriptions, and bills.

• Don’t assume all medical costs are deductible. You’re looking at the portion above the AGI floor, and certain types of payments (like cosmetic procedures) may not qualify.

• Consider how the decision to itemize or take the standard deduction affects you. If your total itemized deductions (including medical) don’t exceed the standard deduction, it might be simpler to take the standard amount, even if you have substantial medical costs.

A little nuance that often surprises people

The treatment of alimony changed in 2019, but retroactive effects aren’t automatic for all cases. If you’re unsure about whether a particular agreement qualifies as pre-2019 alimony or if there are other catch-alls in your situation, it’s worth a quick check with a tax pro or a reliable resource. The line between adjustments to income and itemized deductions isn’t always crystal clear in practice, especially when family arrangements and payments cross calendar years.

A conversational note about tax terminology

If you’ve ever opened a tax form and felt overwhelmed by the jargon, you’re not alone. Terms like AGI, Schedule A, and adjustments to income can sound like a different language. The practical takeaway is simple: alimony under a pre-2019 agreement can reduce your gross income directly; medical expenses can reduce your taxable income only if they exceed a threshold and if you itemize. Those two paths run in parallel but don’t merge in the same box.

Real-world flavor: different scenarios, same core idea

• Scenario A: A taxpayer pays $23,000 in alimony under a pre-2019 agreement and has modest medical expenses. The alimony deduction is straightforward: $23,000 reduces the gross income directly. The medical expenses, if they don’t exceed the AGI floor when added to other itemized deductions, won’t offer extra tax relief beyond the standard deduction.

• Scenario B: A taxpayer has high medical costs that clear the AGI floor but paid little or no alimony. The medical costs become a meaningful itemized deduction, but there’s no alimony adjustment to offset income. You’ll be balancing two different pieces of the tax puzzle.

• Scenario C: A taxpayer has both: alimony paid under pre-2019 terms and medical costs that exceed the AGI floor. Here you get both: the $23,000 adjustment plus the eligible portion of medical expenses on Schedule A. It’s like getting two levers to lower your tax bill.

The takeaway, plainly put

If Paul’s alimony payments total $23,000 and the agreement qualifies under the pre-2019 rules, the amount he can deduct as an adjustment to income is $23,000. Medical expenses behave differently and depend on the AGI floor and whether you choose to itemize. In Paul’s scenario, the $23,000 alimony deduction stands as the primary adjustment to income, with medical costs taking a secondary route through itemized deductions if they surpass the threshold.

A closing thought

Tax rules are a mix of precise math and practical storytelling. The numbers matter, and the structure matters too. Understanding the distinction between an adjustment to income and an itemized deduction helps you see how different financial moves translate into tax outcomes. And while the specifics can feel a bit dry, they’re really about shaping your financial picture in a way that’s fair and predictable.

If you’re curious to see how other household scenarios play out—different years, different types of payments, or varying medical expense levels—you’ll find that the core idea stays the same: some items shave straight off income, others adjust what you owe after you’ve decided how you’ll claim deductions. It’s all part of the broad, practical world of tax literacy—a topic that matters whether you’re studying for a course, handling family finances, or just trying to keep more of your hard-earned money in your pocket.