Question

Medical Expenses (LO 5.6)

In 2018, Margaret and John Murphy (age 66 and 68, respectively) are married taxpayers who file a joint tax return with AGl of $25,400. During the year they incurred the following expenses:

Medical insurance premiums $1,150
Premiums on an insurance policy that pays $100 per day for each day Margaret is hospitalized 400
Medical care lodging (two people, one night) 65
Hospital bills 2,100
Doctor bills 850
Dentist bills 175
Prescription drugs and medicines 340
Psychiatric care 350

In addition, they drove 83 miles for medical transportation, and their insurance company reimbursed them $900 for the above expenses. On the following segment of Schedule A of Form 1040, calculate the Murphy's medical expense deduction.

If required, round any amount to the nearest dollar. Enter all amounts as positive numbers.

Caution. Do not include expenses reimbursed or paid by others. Medical and Dental Expenses 1 Medical and dental expenses (see instructions) . . . . . . . . . . . . . . 1

2 Enter amount from Form 1040, line 7. . . . . 2

3 Multiply line 2 by 7.5% (.075) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

4 Subtract line 3 from line 1. If line 3 is more than line 1, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Answer 1