Medical Deductions

[jskouberdis]

I have question regarding medical deductions.  In most cases it doesn't matter since the taxpayer never gets a medical deduction anyway.  Should I gross up the total medical deductions by amounts reimbursed by HSA plans.  This amount form the 1099-SA gets subtracted in the medical deduction worksheet.  My client gave me the net out of pocket expenses that insurance or HSA distributions did not cover and then the HSA distribution gets deducted on the worksheet.  I looked up in the help area and this is not addressed.  From a logical point of view I think I should be adding this amount to medical expenses.  What do the people in the community do for this issue.

[IRonMaN · Accepted solution]

Gross it up if you are being given the net amounts.

[Just-Lisa-Now-]

I only enter medical expenses NOT paid by HSA, and dont make any adjustment for HSA on the worksheet.

[jskouberdis]

The program automatically enters the HSA distribution to the medical worksheet as a deduction that is why I am thinking that you have to gross up your medical deductions for amounts reimbursed by HSA and out of pocket medical expenses.

[Just-Lisa-Now-]

when you fill out the 1099SA it moves that amount to the medical expenses on Sch A?  Ive never noticed this, I guess its never been enough to make a difference.

[Skylane]

Check the box that the HSA distribution was used to pay medical expenses 

[jskouberdis]

I do check the box.  And that prevents the distribution from being taxable.  But it still takes the distribution to the medical deduction worksheet and subtracts that number from your unreimbursed medical expenses.  I think the best way is to add the expenses that were reimbursed from HSA plan to total unreimbursed medical expenses and then you will get a correct deduction.