Question

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, they drove 80 miles for medical transportation, and their insurance company reimbursed them $800 for the above expenses. On the following segment of Schedule A of Form 1040, calculate the Murphy's medical expense deduction. If required, round any amount to the nearest dollar. Enter all amounts as positive numbers.

Caution. Do not include expenses reimbursed or paid by others.Medical
and
Dental
Expenses1Medical and dental expenses (see instructions) . . . . . . . . . . . . . . 12Enter amount from Form 1040 or 1040-SR, line 8b. . . . .23Multiply line 2 by 10% (.10) . . . . . . . . . . . . . . . . . . . . . . . . . . . .34Subtract line 3 from line 1. If line 3 is more than line 1, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . .4

Answer 1

As per Schedule A you can deduct expenses paid for medical and dentist care for yourself and your spouse which exceed 7.5% of the adjusted gross income.

So in this case AGI is $ 26,100 of which 7.5% is $1,957.5 .

Also all the medical expenses fall into the inclusion category which care allowed for deduction hence the total of all expenses come to $ 5,605

Out of this the amount reimbursed by the insurance company is to be reduced.

Hence the net amount available for deduction is $ 5,605 - $ 800 = $4,805

Out of this 7.5% is not allowed

Therefore deduction that can taken = $4,805 - $1,957.5 = $ 2,847.5