Richard,age 50,is employed as an actuary.For calendar year 2014,he had AGI of $130,000 and paid the following medical expenses: Derrick and Jane would qualify as Richard's dependents except that they file a joint return.Richard's medical insurance policy does not cover them.Richard filed a claim for $4,800 of his own expenses with his insurance company in November 2014 and received the reimbursement in January 2015.What is Richard's maximum allowable medical expense deduction for 2014?

Question

Richard,age 50,is employed as an actuary.For calendar year 2014,he had AGI of $130,000 and paid the following medical expenses:  Derrick and Jane would qualify as Richard's dependents except that they file a joint return.Richard's medical insurance policy does not cover them.Richard filed a claim for $4,800 of his own expenses with his insurance company in November 2014 and received the reimbursement in January 2015.What is Richard's maximum allowable medical expense deduction for 2014?

Quizplus · Accepted Answer

Richard's medical expense deduction is $7,090,determined as follows:
 11ea86f6_cc00_e94e_8084_2b946f62fd39_TB4134_00 Although Derrick and Jane cannot be claimed as Richard's dependents,they could have been had they not filed a joint return.Therefore,they qualify for the medical expense deduction.Insulin is an exception to the rule that nonprescribed drugs do not qualify as medical expenses.The insurance recovery was not received until 2015.Therefore,it has no effect on the medical expense deduction for 2014.

Richard,age 50,is Employed as an Actuary