TAX EXPERTS?? Medical bills question??

[LD1]

Its almost tax time again, and I have a question about medical bills and wont be able to get ahold of my tax guy till tomorrow...hopefully....so I will ask here and see if anyone has any suggestions.

With a childbirth that happened this year, we are looking at somewhere between 9k and 11k out of our pockets. From what I have read, you can only claim any bills that exceed 10% of AGI. We currently have about 5k worth of the bills that have come due in the last week. And likely another 5-6k to come. If I pay the ~5k tomorrow, it looks as if I wont be able to claim any of it, as our AGI exceeds 50k. Then the same would be true next year paying the remainder 5-6k.

If I wait until after the 1st to pay everything, 9-11k, it would be close, but we might get to deduct a few grand. Just depends on how much we end up owing, and how much we end up making.

So I am thinking of just waiting til next year, but didnt know if there was something I was overlooking? OR some other way to deduct the money this year and next that would make it wiser to pay some of it in this calendar year??? I am no tax expert, but from what I read online and on IRS website, it looks better to wait. But time is short if that isnt the smarter move.

 

[PsRumors]

Do you need the deduction this year? If not, wait.

 

[aczlan]

Not a tax export, but I would wait till after the first if you can.

Aaron Z

 

[randy41]

i would wait to pay the bills until 2014 and also increase the number of dependents claimed on my pay to get more take home. 10k in deductions is probably worth a couple or three dependents.

 

[dave1949]

Not an expert.

I believe health insurance premiums (if you pay them, or the portion you pay) are deductible when you total up your health care expenses.

If you wait until next year, you may have other expenses before Dec. 31, 2014 that could help reach the threshold. If you know for sure you won't reach it this year, then it seems better to wait.

 

[LD1]

Do you need the deduction this year? If not, wait.

Not really

i would wait to pay the bills until 2014 and also increase the number of dependents claimed on my pay to get more take home. 10k in deductions is probably worth a couple or three dependents.

10k in bills isnt 10k in deductions if I am reading it correctly. (Which is why I am asking on here to see if anyone knows things I dont). But my understanding is I can only claim bills that exceed 10% of my AGI. So if the wife and I make 80k, and I have 10k in bills, its only a 2k deduction....?

Not an expert.

I believe health insurance premiums (if you pay them, or the portion you pay) are deductible when you total up your health care expenses.

Not sure. I was looking that up, and I dont think I can claim the. Only way to claim employer sponsered insurance premiums is if they show on your w2, which would mean the portion you paid was after tax. With the plan we have being a pre-tax deduction, I cannot claim it as a deduction, cause I never paid taxes on it in the first place, and that money wasnt figured in the AGI.

If I am not able to get ahold of my tax guy tomorrow, I will likely just wait til the first of the year.

 

[Carl_NH]

As others have said wait to 2014 as you will have an additional dependent you can claim in 2013.

Also, all medical, dental expenses, Dr. appointments, mileage to/from and also medical equipment necessary is applicable (not the baby crib though).

The way I understand it is its the amount over 10% of your AGI you can claim as a tax credit. So if you know what your general income outlook is for 2014, and total medical expense you should be able to make a decision.

As long as the govt doesn't change the rules or raise the threshold for 2014!

 

[HillStreet]

Not sure it's 10%, I think it is actually 7.5% reported on 1040 schedule A. That makes the amount over 7.5% of AGI a deduction, not a credit. As others have mentioned, associated costs such as mileage, health care premiums, etc are deductible too. (Might be certain modifications or exemptions for health spending accounts, or pre-tax premium deductions). I am not a tax preparer, only learned this doing my own taxes. By the way, I am usually only close to the deduction, but always seem to be just under the threshold.

 

[smstonypoint]

10k in bills isnt 10k in deductions if I am reading it correctly. (Which is why I am asking on here to see if anyone knows things I dont). But my understanding is I can only claim bills that exceed 10% of my AGI. So if the wife and I make 80k, and I have 10k in bills, its only a 2k deduction....?

Yes. See Schedule A for 2013 -- http://www.irs.gov/pub/irs-pdf/f1040sa.pdf.

Also, all medical, dental expenses, Dr. appointments, mileage to/from and also medical equipment necessary is applicable (not the baby crib though).

The way I understand it is its the amount over 10% of your AGI you can claim as a tax credit. So if you know what your general income outlook is for 2014, and total medical expense you should be able to make a decision.

I agree except the OP would be itemizing a deduction rather than obtaining a tax credit.

Steve

 

[smstonypoint]

Not sure it's 10%, I think it is actually 7.5% reported on 1040 schedule A.

This depends on the filer's age -- see line 3 of Schedule A: http://www.irs.gov/pub/irs-pdf/f1040sa.pdf.

Steve