Question

4,300 200 Hearing aids Hearing aid batteries Installation of an elevator in their home since Kate can no longer walk the stairs Cost of elevator/installation $ 12,000 Increase in Fair Market Value of the house due to elevator $2,000 Check answer (a) 10,000

Answer 1

S.No.	Expenses that can be claimed	Amount ($)	Reason
1	Blue Cross Premiums	5000	Allowed as a medical expense under IRS pub. 502
2	Accident Policy Premiums (policy pays $100 / day for any day policy holder is hospitalized)	NA	IRS pub. 502 disallows premium paid for policies that pay you a guaranteed amount each week for stated no. of weeks if you are hospitalized for sickness or injury
3	Accident Policy Premiums (pays a fixed amount for loss of hand/fingers etc.)	NA	IRS pub. 502 disallows premium paid for policies for loss of limb,sight.etc.
4	Disability policy premium (pays $100/day if policyholder becomes diabled)	NA	IRS pub. 502 disallows premium paid for policies for loss of limb,sight.etc.
5	Qualified long-term care premium (each has a policy)	2340	Allowed as a medical expense under IRS pub. 502 with limit. For age 41 to 50, $ 780 and for age 51 to 60, $1560. Therefore, total for John and Mary is $ 2360
6	Prescription drugs	682	Allowed as a medical expense under IRS pub. 502
7	Over the counter drugs (Aspirin, cough medicines,etc.)	NA	Non-prescription drugs not allowed as a medical expense under IRS pub 502
8	Doctors and dentists (not covered by insurance)	500	Allowed as a medical expense under IRS pub. 502
9	Hospital emergency room (not covered by insurance)	1000	Allowed as hospital meals and lodging allowed if primary purpose is medical treatment
10	Cost of Mary's facelift (not covered by insurance)	NA	Cosmetic surgery expenses not allowed as per pub. 502
11	John's eyeglasses	300	Allowed as a medical expense under IRS pub. 502
12	Mary's contact lenses	200	Allowed as a medical expense under IRS pub. 502
13	Ambulance	200	Allowed as a medical expense under IRS pub. 502
14	Wheelchair rental	100	Allowed as a medical expense under IRS pub. 502
15	Mileage driven for doctor appointments (100 miles)	18	18 cents per mile allowed as an expense under IRS pub. 502
16	Parking for doctor visits	200	Allowed as a medical expense under IRS pub. 502
17	Kate's hearing aids	4300	Allowed as a qualifying relative under IRS pub. 502 since Kate resides with Mary and John and also they provide for over half of Kate's support
18	Kate's hearing aid batteries	200	Allowed as a qualifying relative under IRS pub. 502 since Kate resides with Mary and John and also they provide for over half of Kate's support
19	Installation of elevator ($12000 - $ 2000)	10000	Amount incurred for installation of special equipments such as elevators at home are allowed as a medical expense provided the primary purpose is for the medical care of yourself, spouse, dependent. Qualifying relative also qualify as dependent provided US citizen. Such cost is deductible as medical expense after reducing the actual cost by any increase in value of property. Therefore, $ 12,000 - $ 2,000
	Total medical expenses that can be deducted	25040
	Total adjusted gross salary	200000
	Limitation (7.5% of Adjusted Gross Salary)	15000
	Total medical expenses after limitation ($25,040 - $ 15,000)	10040