Wayne and Maria file a joint tax return on which they itemize their deductions and report AGI of $50,000. During the year they incurred $1,500 of medical expenses when Maria broke her leg. Furthermore, their dentist informed them that their daughter, Alicia, needs $3,000 of orthodontic work to correct her overbite. Wayne also needs a new pair of eyeglasses that will cost $300. What tax issues should Wayne and Maria consider?

Explanation:

Medical and Dental Expenses as part of Itemized Deductions are allowed to the extent they greater than 10% of the Adjusted Gross Income (AGI).

The AGI for Wayne and Maria is $50,000. So any expenditure on medicine and dental, greater than 10% of AGI which is $5,000 will be allowed as Itemized deduction subject to certain conditions.

1. Expenditure of $1,500 incurred as Maria had broken leg will be allowed as deduction as it is for general medical services. Had it been for personal hygiene or for any health membership, it wouldn/t have been allowed.

2. $3,000 to incurred to the correct the overbite of their daughter Alicia. This will be allowed as deduction as it falls under the category of surgery done to cure birth defect and not to improve appearance. However, to claim such deduction, the parents must prove that their daughter is related or lives with them for full year, that they provide over 50% of the total support and Alicia is the US citizen or resident of USA, Canada or Mexico.

3. Assuming the glasses to be used by Wayne are medicated eyeglasses, such expenses will be allowed.

So, adding all the three line items, we get

= 1500 + 3000 + 300

=$4,800

answer; consideration;