Caleb's medical expenses before reimbursement for the year include the following: Caleb's AGI for the year is $50,000.He is single and age 58. Caleb also receives a reimbursement for medical expenses of $1,000.Caleb's deductible medical expenses that will be added to the other itemized deduction will be
A)$10,350.
B)$9,100.
C)$14,500.
D)$15,100.

Question

Caleb's medical expenses before reimbursement for the year include the following:  Caleb's AGI for the year is $50,000.He is single and age 58. Caleb also receives a reimbursement for medical expenses of $1,000.Caleb's deductible medical expenses that will be added to the other itemized deduction will be
A)$10,350. 
B)$9,100. 
C)$14,500. 
D)$15,100.

Quizplus · Accepted Answer

Caleb can only deduct medical expenses that exceed 7.5% of his AGI, which is $3,750 ($50,000 x 7.5%). His total medical expenses before reimbursement are $11,450, but as he received a reimbursement of $1,000, his deductible medical expenses are $10,450 ($11,450 - $1,000). However, since only expenses exceeding 7.5% of his AGI can be deducted, Caleb's deductible medical expenses will be $9,100 ($10,450 - $1,350). This amount will be added to Caleb's other itemized deductions.

Caleb's Medical Expenses Before Reimbursement for the Year Include the Following