MFS and medical expenses

[powerage]

I finally got a difficult return to do. 1 W-2 (wife,), 9 1099-R's, 2 SSA's, plus a couple of other minor income statements. Older couple, with a $14,200 standard deduction. Their medical expenses for 2012 are over $17,000, all documented very well. The medical expenses are roughly split 52-48. Will MFS make that much difference? I have not even factored in the medical miles driven, because their prior preparer never mentioned it. Right now, they are getting a refund.

As a bonus, I get my first casualty loss on a return since the 2007 tax year. Plus legit charitable contributions. I also get to venture in to mandatory distributions, which is also rare for me. But I love it. Easy returns are boring. And this client was prepared record wise, just a lot of stuff to go through.

[FEDUKE404]

Making a decision

That's a difficult return?? Tedious....not difficult.

As for the MFS/MFJ issue, your software should give you a reasonable "guesstimate" as to what might happen, assuming you code all of the income properly with H/W/J. It gets sticky when you have to split itemized deductions, which would fall into the "who paid what" category. Joint checking accounts??

Medical expenses follow the same scenario. You could spend more time figuring those out (people get very confused over billed vs paid expenses, and having to deal with insurance reimbursement issues) than the rest of the return.

The first thing I would look at is what happens to TAXABLE Social Security benefits when MFS is used. That alone might tilt the tables toward MFJ.

Oh yes: They also would have to pay you for TWO tax returns.

I don't remember the last time I tackled a casualty loss....that 10% AGI haircut takes out most ones when insurance issues are legitimately factored in. IIRC, the last one I did prepare was hurricane-related, which involved amending the prior year for the current year damages. (NOT a project for the first week in April!)

Good luck!

FE

[powerage]

she walked

Yea FEDUKE, it was more tedious than difficult. The fees were too high. She paid $65 last year for a similar return. And that was before I did the MFJ/MFS comparison. I'm not sure if by doing that it adds to our fees. I would hope not. If it was my own business, I would have charged her $300 for this return.

That said, she had indisputable proof to write off their vitamins and supplements of $2500. That was first for me in 8 years.

And the casualty loss did not apply to her, even though she paid for the expenses of the accident.

[taxmom34]

what kind of indisputable proof qualifies for vitamins and supplements to be taken as a medical explense? I take calcium, fish oil, vitamin D, vitamin B12 , but only the B12 is a prescription, the others are dr recommended. I can only claim the B12 as a medical expense.