Thanks for all the good advice!


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- quote -

This part of your question suggests that you do not usually
meet the 7.5% threshold. If that is the case and 2004 is
the only year, because of the accident, that you will reach
the threshold, then you want to pay as much medical expense
in 2004 as possible. If medical providers have not yet
billed you for 2004 services (they are waiting for insurance
payments) then call them before year-end and make estimated
co-payments. If you see a doctor in December, stop at the
desk on the way out and make your co-payment. If you have
an annual exam in January, do it Dec 31. If you have
optional surgery/dental/... scheduled for 2005, do it in
2004. If you use expensive Rx's, buy as much as possible in
December. If you write checks to pay for medical insurance,
mail the 1st payment for 2005 in December 2004 (it's the
date mailed that counts for taxes, not the due date), and so
on.

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**THE-RFI-EMI-GUY** <rhyolite[at]nettally.com> wrote:

- quote -

No, you deduct what you PAID in 2005 on Schedule A, line 1
and if you get a reimbursement in 2005 you enter it on line
10 of your 1040 (see instructions for this) IF you actually
itemixed in 2004.

- quote -

YES

- quote -

Only by itemizing in 2003 IF you paid them in 2003.

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*THE-RFI-EMI-GUY** <rhyolite[at]nettally.com> wrote:

- quote -

Not sure I entirely follow. Are these expenses that you paid
and are seeking reimbursement from your insurer for, or are
these expenses that you are trying to get the insurer to pay
the providers for (and in the meantime, the hospital is
(perhaps with increasing urgency) billing you for)?

If you paid the expenses, you get the deduction in the year
you paid them. But if you ran up expenses that your hospital
billed, but you haven't actually paid yet, there's no
deduction for those.

You don't have to make it complicated. Money you paid by
December 31, less reimbursements you received by December 31
that apply to those payments, is your expenses.

- quote -

Reimbursements in a later year are income in the later year.
If you pay deductible medical expenses in 2004 and get a
reimbursement for those expenses in 2005, the reimbursement
is income in 2005.

- quote -

Depends on how it was paid. If it was paid from a "cafeteria
plan", it was already excluded from your income, and you
can't deduct it again. Otherwise, sure you can.

- quote -

If you paid expenses in 2003, and you would have enough
expenses to exceed the 7.5% floor, you could file an amended
return for 2003. You can't just report them in a different
year; you have to report expenses in the year you paid them.

--
Chris Green

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**THE-RFI-EMI-GUY** <rhyolite[at]nettally.com> wrote:

- quote -

Sory tohear about your son.

To deduct medical expenses you paid for him, you must have
furnished more than half his support.

- quote -

You can always file on extension to postpone making this
decision as long as possible. But you get the medical
expense only in the year you paid it.

If it turns out that you should have claimed a medical
expense and discover it only after you filed, even a year or
two later, you can amend.

- quote -

Yes, medical insurance premiums you paid with after-tax
money for you, your spouse or your medical dependents can be
deducted.

- quote -

Only if you paid those expenses in 2003.

73,

__
Art Kamlet ArtKamlet [at] AOL.com Columbus OH K2PZH

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**THE-RFI-EMI-GUY** wrote:

I'm assuming you are a cash basis taxpayer. If you are on
an accrual basis, the analysis is different.

- quote -

You MUST show those reimbursements as income for 2005, to
the extent that they led to actual deductions in 2004. If
the reimbursement would push your total medical expenses
below the 7.5%, or would have led to your taking the
standard deduction rather than itemizing deductions, then
the taxable reimbursement cuts out there.

On the other hand, if you are not reimbursed for something
you expected to be reimbursed for, that can only be taken by
amending your 2004 return.

- quote -

Yes.

- quote -

You can only recover expenses paid in 2003 on your 2003
return. If it helps, you can amend your 2003 return to add
them.

On the other hand, if the accident occured in November 2003,
it seems unlikely you'd even get a hospital bill until
January, so it falls as a 2004 expense.

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**THE-RFI-EMI-GUY** wrote:

- quote -

Do the math for both years, estimating 2005, BEFORE BEFORE
BEFORE your 2004 filing!!! It is often the case that taking
a deduction in one year, then reporting reimbursements the
next year is a losing, for the taxpayer, proposition
(increasing AGI and thus having multiple bad effects on your
2005 taxes). Don't guess - do the math and know, a wrong
guess can be very expensive.

You do not have the option of filing amended returns for
2004 because of 2005 reimbursements, you are required to
report 2005 reimbursements of 2004 deductions as 2005
income.

To avoid having to report 2005 reimbursements as income, do
not claim 2004 deductions for any Any ANY expense that might
be reimbursed in 2005 or later year. Indeed, to be really
safe claim even less! Thus 2005 reimbursements are not for
expense deducted in 2004 and do not need to be reported as
2005 income.

When the dust has settled, when you have received all the
reimbursements that you will ever receive for 2004, then you
file an amended return for 2004 claiming the full deduction
amount - 2004 expense less 2004, 5, 6 ... reimbursements
(you can file amended returns for missed deductions). Just
remember to watch for the latest date you can file a 2004
amended return if reimbursements drag out into years past
2005.

btw, your the wording of your question suggests that you
don't want to do amended returns. Amended returns are easy
and they are your friend, saving you hundreds of dollars.

dick w

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"**THE-RFI-EMI-GUY**" <rhyolite[at]nettally.com> wrote

- quote -

You can only deduct (include as an itemized deduction) the
exact amount you "spent" on medical care. That is to say,
that only those amounts paid in cash, check or on a charge
card will be included. If it's not paid, it's not included
in your totals.

If you pay for a medical expense and in a later year the
insurance reimburses you, you must include that amount as
income in the year you receive the reimbursement check.

- quote -

Health insurance premiums are included in medical expenses
on Schedule A.

- quote -

Again, deductible in the year paid. Expenses paid in 2003
can only be claimed in 2003. Those amounts paid in 2004 can
only be claimed in 2004, etc and so on.

--
Paul A. Thomas, CPA
Athens, Georgia
taxman at negia.net

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**THE-RFI-EMI-GUY** <rhyolite[at]nettally.com> writes:

- quote -

****NO!!! If you recover any amount that you *deducted in
an earlier year on Schedule A (Form 1040), you generally
must include the full amount of the recovery in your income
in the year you receive it.

*This is limited to the amount for which a tax benefit
resulted.

- quote -

****YES!!!

- quote -

****You may do so by filing an amended tax return, including
a corrected Schedule A (Form 1040) "Itemized Deductions".

"Jack" - John H. Fisher - TaxService[at]aol.com
Philadelphia, Pa - Atlantic City, NJ - West Wildwood, NJ
My Newsgroups & Boards at: http://members.aol.com/TaxService/index.html

Where Ignorance is bliss, 'tis folly to be wise!=

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I have some pretty large family medical expenses this year
related to an accident my son had. While the insurance
company is to cover some things to 100%, others will be
limited to 80% coverage and we have other expenses they will
probably not cover at all. I expect that the process of
reimbursement from the insurance company will take about 2
years including appeals. We are ~10 months into this
nightmare and the hospital bill has not been paid although
they are approved under the plan.

I intend to itemize the uninsured medical expenses, co-pays
etc., including travel to several clinics including Mayo
Clinic, and including "questionable items" which I feel the
insurer should cover, but have a high probability of being
denied. Obviously I will not include items which do not meet
IRS definitions of medical related expenses.

1. If, after filing my 2004 return, the insurer does pay for
some items, (in 2005) will I have to ammend the 2004 return
or may I show those reimbursements as income for 2005?

2. Can the cost of my family medical insurance be included
in the medical expenses? This is a large amount which would
go a ways toward satisfying the 7.5% threshold.

3. Can I recover any expenses from 2003 (the accident was
Nov 2003)?

--
Joe Leikhim K4SAT
"The RFI-EMI-GUY"

The Lost Deep Thoughts By: Jack Handey
Before a mad scientist goes mad, there's probably a time
when he's only partially mad. And this is the time when
he's going to throw his best parties.

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