Fred and Lucy are married, ages 33 and 32, and together have AGI of $120,000 in 2016.
Question:
Fred and Lucy are married, ages 33 and 32, and together have AGI of $120,000 in 2016. They have four dependents and file a joint return. They pay $5,000 for a high deductible health insurance policy and contribute $2,600 to a qualified Health Savings Account. During the year, they paid the following amounts for medical care: $9,200 in doctor and dentist bills and hospital expenses, and $3,000 for prescribed medicine and drugs. In October 2016, they received an insurance reimbursement of $4,400 for the hospitalization. They expect to receive an additional reimbursement of $1,000 in January 2017. Determine the maximum itemized deduction allowable for medical expenses in 2016?
a. $800
b. $3,400
c. $9,200
d. $12,800
e. None of the above
South Western Federal Taxation 2015 Essentials of Taxation Individuals and Business Entities
ISBN: 9781285438290
18th edition
Authors: James Smith, William Raabe, David Maloney, James Young