Question 1

Bill paid $2,500 of medical expenses for his daughter, Marie. Marie is married to John and they file a joint return. Bill
can include the $2,500 of expenses when calculating his medical expense deduction.

Accepted Answer

Bill can include medical expenses he paid for his dependent (daughter) even if she is married and filing jointly with her spouse.

Question 2

Personal expenditures that are deductible as itemized deductions include medical expenses, Federal income taxes, state income taxes, property taxes on a personal residence, mortgage interest, and charitable contributions.

Accepted Answer

Federal income taxes are not deductible as itemized deductions; however, state income taxes, property taxes on a personal residence, mortgage interest, and charitable contributions are deductible.

Question 3

Maria traveled to Rochester, Minnesota, with her son, who had surgery at the Mayo Clinic. Her son stayed at the clinic for the duration of his treatment. She paid airfare of $300 and $50 per night for lodging. The cost of Maria's airfare and lodging cannot be included in determining her medical expense deduction.

Accepted Answer

False

Question 4

Shirley pays FICA employer's share) on the wages she pays her housekeeper to clean and maintain Shirley's personal residence. The FICA payment is not deductible as an itemized deduction.

Accepted Answer

The FICA employer's share paid by Shirley on wages for her housekeeper is not deductible as an itemized deduction.

Question 5

Jim's employer pays half of the premiums on a group medical insurance plan covering all employees, and employees pay the other half. Jim can exclude the half of the premium paid by his employer from his gross income and may include the half he pays in determining his medical expense deduction.

Accepted Answer

This is a correct statement according to IRS regulations. Jim can exclude the portion of the premium paid by his employer from taxable income and include the portion he pays as a medical expense deduction on his tax return.

Question 6

In 2019, Rhonda received an insurance reimbursement for medical expenses incurred in 2018. She is not required to include the reimbursement in gross income in 2019 if she claimed the standard deduction in 2018.

Accepted Answer

This statement is true. If Rhonda claimed the standard deduction in 2018, she cannot deduct her medical expenses on her tax return. Therefore, the insurance reimbursement she received for those expenses is not taxable income in 2019.

Question 7

Mason, a physically handicapped individual, pays $10,000 this year for the installation of wheelchair ramps, support bars, and railings in his personal residence. These improvements increase the value of his personal residence by
$2,000. Only $8,000 of the expenditure qualifies as a medical expense for tax purposes.

Accepted Answer

The $2,000 increase in value does not affect the medical expense deduction. Only the $8,000 that qualifies as a medical expense can be deducted.

Question 8

Adrienne sustained serious facial injuries in a motorcycle accident. To restore her physical appearance, Adrienne had cosmetic surgery. She cannot deduct the cost of this procedure as a medical expense.

Accepted Answer

Cosmetic surgery is generally not deductible as a medical expense unless it is medically necessary to correct a deformity arising from a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease. In Adrienne's case, the cosmetic surgery was done for the purpose of restoring her physical appearance, which does not meet the criteria for a deductible medical expense.

Question 9

A physician recommends a private school for Ellen's dependent child. Because of the physician's recommendation, the cost of the private school will qualify as a medical expense deduction subject to percentage limitations).

Accepted Answer

The cost of tuition for private school is not considered a deductible medical expense, even if recommended by a physician, unless the education is specifically for and necessary to the medical care of the individual (e.g., a school for children with special educational needs due to medical conditions).

Question 10

A taxpayer may not deduct the cost of new curbing relative to a personal residence), even if the construction is required by the city and the curbing provides an incidental benefit to the public welfare.

Accepted Answer

The cost of new curbing relative to a personal residence is considered a capital expenditure and is not deductible as a business or personal expense, even if it is required by the city and provides an incidental benefit to the public welfare.

Question 11

Matt, a calendar year taxpayer, pays $11,000 in medical expenses in 2018. He expects $5,000 of these expenses to be reimbursed by an insurance company in 2019. In determining his medical expense deduction for 2018, Matt must reduce his 2018 medical expenses by the amount of the reimbursement he expects in 2019.

Accepted Answer

The answer of Matt, a calendar year taxpayer, pays $11,000...

Question 12

Fees for automobile inspections, automobile titles and registration, bridge and highway tolls, parking meter deposits, and postage are not deductible if incurred for personal reasons, but they are deductible as deductions for AGI if incurred as a business expense by a self-employed taxpayer.

Accepted Answer

Fees for automobile inspections, automobile titles and registration, bridge and highway tolls, parking meter deposits, and postage are deductible as deductions for AGI if incurred as a business expense by a self-employed taxpayer. They are not deductible if incurred for personal reasons.

Question 13

In 2018, Brandon, age 72, paid $5,000 for long-term care insurance premiums. He may include the $5,000 in computing his medical expense deduction for the year.

Accepted Answer

Long-term care insurance premiums are considered qualified medical expenses and can be included in the medical expense deduction for taxpayers who itemize their deductions. The deduction is subject to limitations based on the taxpayer's age and the amount of their qualifying medical expenses. In this case, Brandon is 72 years old and his premiums may be included in his medical expense deduction.

Question 14

Georgia contributed $2,000 to a qualifying Health Savings Account in the current year. The entire amount qualifies as an expense deductible for AGI.

Accepted Answer

Contributions to Health Savings Accounts are deductible for AGI, so Georgia can deduct the full $2,000 contribution from her taxable income.

Question 15

Mindy paid an appraiser to determine how much a capital improvement made for medical reasons increased the value of her personal residence. The appraisal fee qualifies as a deductible medical expense.

Accepted Answer

The answer of Mindy paid an appraiser to determine how...

Question 16

Upon the recommendation of a physician, Ed has a swimming pool installed at his residence because of a heart condition. If he is allowed to deduct all or part of the cost of the pool, Ed's increase in utility bills due to the operation of the pool qualifies as a medical expense.

Accepted Answer

According to IRS guidelines, if a swimming pool is installed upon the recommendation of a physician, the cost of the pool may be partially deductible as a medical expense. Additionally, any increase in utility bills due to the operation of the pool may also qualify as a medical expense.

Question 17

Chad pays the medical expenses of his son, James. James would qualify as Chad's dependent except that he earns
$7,500 during the year. Chad may claim James' medical expenses even if he is not a dependent.

Accepted Answer

According to IRS rules, a taxpayer can claim the medical expenses of a child who would qualify as a dependent except that they earn too much income. Therefore, Chad can claim James' medical expenses even if he is not a dependent.

Question 18

This year Dena traveled 600 miles for specialized medical treatment that was not available in her hometown. She paid $90 for meals during the trip, $145 for a hotel room for one night, and $15 in parking fees. She did not keep records of other out-of-pocket costs for transportation. Dena can include $167 in computing her medical expenses.

Accepted Answer

The answer of This year Dena traveled 600 miles for...

Question 19

Sergio was required by the city to pay $2,000 for the cost of new curbing installed by the city in front of his personal residence. The new curbing was installed throughout Sergio's neighborhood as part of a street upgrade project. Sergio may not deduct $2,000 as a tax, but he may add the $2,000 to the basis of his property.

Accepted Answer

According to IRS rules, the cost of curbs and sidewalks installed by a government agency is considered a capital improvement and may be added to the basis of the property. It is not deductible as a tax.

Question 20

The election to itemize is appropriate when total itemized deductions are less than the standard deduction based on the taxpayer's filing status.

Accepted Answer

The election to itemize is appropriate when total itemized deductions are greater than the standard deduction based on the taxpayer's filing status.

Quiz 10: Deductions and Losses: Certain Itemized Deductions

Bill paid $2,500 of medical expenses for his daughter, Marie. Marie is married to John and they file a joint return. Bill can include the $2,500 of expenses when calculating his medical expense deduction.