If you itemize deductions, you may deduct the amounts you paid for medical and dental expenses that exceeded 7.5% of your adjusted gross income (AGI).

The deduction is allowed for expenses paid for the prevention and alleviation of a physical or mental defect or illness. Medical expenses include expenses related to diagnosis, cure, mitigation, treatment, or prevention of disease, or treatment affecting any function or structure of the body.

• Expenses must be for you, your spouse, or your dependent.  
• Expenses must be paid during the current tax year, regardless of when incurred.
• Expenses must not be compensated by insurance.
• Expenses must not be paid out of a tax-free medical savings or health savings account.
• You must subtract from your deduction total any reimbursement of medical expenses, whether they were paid to you or directly to the doctor or hospital.

• Professional services – doctors, dentists, surgeons, chiropractors, psychiatrists, psychologist, acupuncture, Christian Science Practitioners
• Care services – hospital, qualified long-term care, nursing, laboratory, inpatient drug or alcohol treatment
• Medications – insulin, prescription drugs
• Diseases – diagnosis, mitigation, cure, treatment, or prevention
• Smoking cessation – program fees, prescription drugs to alleviate nicotine withdrawal (this does not include nicotine gum or patches)
• Weight loss – program fees to attend weight loss progams for specific diseases, including obesity, diagnosed by a physician
• Transportation – primarily for and essential to medical care
  Vehicle use – actual out-of-pocket expenses, or the standard mileage rate for medical expenses (20 cents per mile for 2007) 
• Conferences – admission and transportation for conferences relating to the chronic diseases of you, your spouse, or your dependent
• Eye care – prescription eye glasses, contact lenses, or laser eye surgery
• Supplementary items – false teeth, hearing aids, crutches, wheelchairs, guide dogs for the blind or deaf
• Insurance premiums – accident, health, long-term care insurance
  Self-employed persons with a net profit might be able to deduct 100% of medical insurance premiums.

• Non-prescription over-the-counter medicines or drugs
• Funeral / burial
• Most cosmetic surgery
• Attending a program for the improvement of your general health
• Meals and lodging while attending a qualifying conference
• Diet food
• Insurance premiums for life insurance, loss of wages, or any policy that pays you a guaranteed amount each week due to sickness
• Insurance premiums paid by your employer, unless the premiums are included in box 1 of your Form W-2

For more information see IRS Publication 502.