Question

Kwame is a single taxpayer. He has $12,000 in deductible mortgage Interest, 55,700 in deductibio property tax, and his AGI Is $62,135. He incurred the following medical expenses:
$5,550 out-of-pocket hospital stay
$353 for prescriptions
$500 doctor visits
$200 prescription eye glasses
What amount can be deducted for deductible medical and dental expenses?
a. $0
b. $1,743
c. $1,943
d. $6,603

Answer 1

Answer: $1943

Explanation:

It should be noted that medical expenses would only be deducted once it's more than 7.5% of AGI. First, we have to calculate the total medical expenses which would be:

out of pocket hospital stay = $5550

Add: prescriptions = $353

Add: doctor visits = $500

Add: prescriptions eyeglasses = $200

Total = $6603

Since AGI is given as $62135, we then calculate 7.5% of the AGI which would be:

= 7.5% × 62135

= $4660.125

Therefore, the amount can be deducted for deductible medical and dental expenses would be:

= $6603 - $4660.125

= $1942.875

= $1943