S.No. | Expenses that can be claimed | Amount ($) | Reason |
1 | Blue Cross Premiums | 5000 | Allowed as a medical expense under IRS pub. 502 |
2 | Accident Policy Premiums (policy pays $100 / day for any day policy holder is hospitalized) | NA | IRS pub. 502 disallows premium paid for policies that pay you a guaranteed amount each week for stated no. of weeks if you are hospitalized for sickness or injury |
3 | Accident Policy Premiums (pays a fixed amount for loss of hand/fingers etc.) | NA | IRS pub. 502 disallows premium paid for policies for loss of limb,sight.etc. |
4 | Disability policy premium (pays $100/day if policyholder becomes diabled) | NA | IRS pub. 502 disallows premium paid for policies for loss of limb,sight.etc. |
5 | Qualified long-term care premium (each has a policy) | 2340 | Allowed as a medical expense under IRS pub. 502 with limit. For age 41 to 50, $ 780 and for age 51 to 60, $1560. Therefore, total for John and Mary is $ 2360 |
6 | Prescription drugs | 682 | Allowed as a medical expense under IRS pub. 502 |
7 | Over the counter drugs (Aspirin, cough medicines,etc.) | NA | Non-prescription drugs not allowed as a medical expense under IRS pub 502 |
8 | Doctors and dentists (not covered by insurance) | 500 | Allowed as a medical expense under IRS pub. 502 |
9 | Hospital emergency room (not covered by insurance) | 1000 | Allowed as hospital meals and lodging allowed if primary purpose is medical treatment |
10 | Cost of Mary's facelift (not covered by insurance) | NA | Cosmetic surgery expenses not allowed as per pub. 502 |
11 | John's eyeglasses | 300 | Allowed as a medical expense under IRS pub. 502 |
12 | Mary's contact lenses | 200 | Allowed as a medical expense under IRS pub. 502 |
13 | Ambulance | 200 | Allowed as a medical expense under IRS pub. 502 |
14 | Wheelchair rental | 100 | Allowed as a medical expense under IRS pub. 502 |
15 | Mileage driven for doctor appointments (100 miles) | 18 | 18 cents per mile allowed as an expense under IRS pub. 502 |
16 | Parking for doctor visits | 200 | Allowed as a medical expense under IRS pub. 502 |
17 | Kate's hearing aids | 4300 | Allowed as a qualifying relative under IRS pub. 502 since Kate resides with Mary and John and also they provide for over half of Kate's support |
18 | Kate's hearing aid batteries | 200 | Allowed as a qualifying relative under IRS pub. 502 since Kate resides with Mary and John and also they provide for over half of Kate's support |
19 | Installation of elevator ($12000 - $ 2000) | 10000 | Amount incurred for installation of special equipments such as elevators at home are allowed as a medical expense provided the primary purpose is for the medical care of yourself, spouse, dependent. Qualifying relative also qualify as dependent provided US citizen. Such cost is deductible as medical expense after reducing the actual cost by any increase in value of property. Therefore, $ 12,000 - $ 2,000 |
Total medical expenses that can be deducted | 25040 | ||
Total adjusted gross salary | 200000 | ||
Limitation (7.5% of Adjusted Gross Salary) | 15000 | ||
Total medical expenses after limitation ($25,040 - $ 15,000) | 10040 |
4,300 200 Hearing aids Hearing aid batteries Installation of an elevator in their home since Kate...
Problem: 2 taxpayers age 66 and 68 married and file joint tax return , AGI $26,100 -medical insurance premiums $1300 -premiums on an insurance policy that pays $100 per day for each day spent in hospitalized $400 -medical care lodging (twobpeople , one night ) $65 -hospital bills $2100 -doctor bills $850 -dentist bills $200 -prescription drugs and medicines$340 -psychiatric care $350 they drove 80 milles for medical , their insurance reimbursed$800 for the above expenses on schedule A what...
In 2019, Margaret and John Murphy (age 66 and 68, respectively) are married taxpayers who file a joint tax return with AGl of $26,100. During the year they incurred the following expenses: Medical insurance premiums $1,300 Premiums on an insurance policy that pays $100 per day for each day Margaret is hospitalized 400 Medical care lodging (two people, one night) 65 Hospital bills 2,100 Doctor bills 850 Dentist bills 200 Prescription drugs and medicines 340 Psychiatric care 350 In addition,...
Medical Expenses (LO 5.6) In 2018, Margaret and John Murphy (age 66 and 68, respectively) are married taxpayers who file a joint tax return with AGI of $25,400. During the year they incurred the following expenses: Medical insurance premiums $1,150 400 Premiums on an insurance policy that pays $100 per day for each day Margaret is hospitalized Medical care lodging (two people, one night Hospital bills Doctor bills Dentist bills Prescription drugs and medicines Psychiatric care 65 2,100 850 175...
In 2018, Margaret and John Murphy (age 66 and 68, respectively) are married taxpayers who file a joint tax return with Al of $25,400. During the year they incurred the following expenses: Medical insurance premiums $1,150 400 Premiums on an insurance policy that pays $100 per day for each day Margaret is hospitalized Medical care lodging (two people, one night) Hospital bills 2,100 Doctor bills Dentist bills 175 Prescription drugs and medicines 340 Psychiatric care 350 In addition, they drove...
Question 1 BWS Corporation pays the premiums on an $80,000 group-term life insurance policy on the life of its 45-year-old vice-president, Warren. The annual cost per $1,000 of coverage for a person aged 45 to 49 is $1.80. If Warren has paid $25 toward the cost of the insurance, what is the cost of hte policy includible in Warren's gross income? 1) $278.00 2) $144.00 3) $54.00 4) $29.00 5) $0 Question 2 During 2019, Edward East had wages of...
Ask a relative or friend about their policy and complete the Table below. (either company is fine) Comparison: Out-of-Pocket Costs by Healthcare Insurance Company Type of Cost Example Healthcare Co. A Annual Premium (Monthly x 12) $56 x 12 = $672 (Individual) Annual Deductibles $350 per Covered Individual Drugs $0 Physician Office Visits Inc. in $350 Inpatient Inc. in $350 Outpatient Inc. in $350 Mental Health Inc. in $350 Outpatient Therapy (PT, OT, Speech) Inc. in $350 Chiropractic Inc. in...
A homeowners' policy will typically pay up to $500 per plant that is damaged by a covered peril. This is an example of: an aggregate dollar limit an open perils dollar limit C. a specific dollar limit a mixed dollar limit none of the above e. You purchase an annuity for which you will make one payment of $15,000 on your 50 birthday. The annuity will start paying you $400 a month on your 67" birthday until you die. What...
69) A policy that pays you back for actual expenses is called A) An indemnity plan. B) A deductible plan. C) A reasonable and customary plan. D) A reimbursement plan. E) A coinsurance plan m The set amount that you must pay toward medical expenses before the insurance company pays benefits is called A) Deductible. B) Reimbursement C) Indemnity. D) Internal limit. E) Reasonable and customary charges. 71) Which of the following is a government health care program? A) Health...
Paul and Donna Decker are married taxpayers, ages 44 and 42, respectively, who file a joint return for 2019. The Deckers live at 1121 College Avenue, Carmel, IN 46032. Paul is an assistant manager at Carmel Motor Inn, and Donna is a teacher at Carmel Elementary School. They present you with W–2 forms that reflect the following information: Paul Donna Salary $68,000 $56,000 Federal tax withheld 6,770 6,630 State income tax withheld 1,400 1,100 FICA (Social Security and Medicare) withheld...
Paul and Donna Decker are married taxpayers, ages 44 and 42, respectively, who file a joint return for 2019. The Deckers live at 1121 College Avenue, Carmel, IN 46032.PaulDonnaSalary6800056000Federal tax withheld67706630State tax withheld14001100FICA52024284Social Security111-11-1112123-45-6789 Donna is the custodial parent of two children from a previous marriage who reside with the Deckers through the school year. The children, Larry and Jane Parker, reside with their father, Bob, during the summer. Relevant information for the children follows:LarryJaneAge1718Social123-45-6788123-45-6787Months spent99 Under the divorce decree,...