Question 1

Taxpayer (AGI 0,000) incurred the following medical expenses: Doctor bills ,000; Cosmetic surgery (elective) ,000; Prescription drugs ,000; Health insurance premiums (after-tax) ,000. Insurance reimbursed ,000. What is the deductible medical expense amount on Schedule A?

Accepted Answer

1. Sum Qualified Expenses (No cosmetic). 2. Subtract Reimbursements. 3. Calculate Floor (7.5% AGI). 4. Result = Net Expenses - Floor.

Question 2

What mistakes do candidates make on this CPA question?

Accepted Answer

Including cosmetic surgery or forgetting to subtract insurance reimbursements.

Taxpayer (AGI 0,000) incurred the following medical expenses: Doctor bills ,000; Cosmetic surgery (elective) ,000; Prescription drugs ,000; Health insurance premiums (after-tax) ,000. Insurance reimbursed ,000. What is the deductible medical expense amount on Schedule A?

How to approach this question

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