Question

Megan is single, 45-year-old, and has an adjusted gross income of 70,000 for the tax year. She had the following medical expenses: prescriptions1480, doctor co-pays 950, dental bills2800, elective tummy tuck surgery 6500, and health insurance premiums after-tax1800. What is the amount of allowable medical and dental expenses Megan can report on Schedule A Form 1040 line 4?

Answer 1

Megan can report $980 as allowable medical and dental expenses on Schedule A Form 1040 line 4.

Step-by-step explanation:

The amount of allowable medical and dental expenses Megan can report on Schedule A Form 1040 line 4 is calculated by subtracting the applicable threshold from the total medical and dental expenses. The threshold is derived from the adjusted gross income (AGI) and is 7.5% for taxpayers under the age of 65.

In Megan's case, her AGI is $70,000. The threshold is therefore $5,250 (7.5% of $70,000).

Now, let's calculate the total medical and dental expenses:

• Prescriptions: $1,480
• Doctor co-pays: $950
• Dental bills: $2,800
• Elective tummy tuck surgery (not considered a qualifying medical expense): $0
• After-tax health insurance premiums: $1,800

The total medical and dental expenses excluding the elective tummy tuck surgery amount to $6,230 ($1,480 + $950 + $2,800 + $1,800).

However, since the threshold is $5,250, she can only report the excess amount above the threshold. In this case, the excess amount is $980 ($6,230 - $5,250).

Therefore, the amount of allowable medical and dental expenses Megan can report on Schedule A Form 1040 line 4 is $980.