D.V.
New Member
- 13
New to this - sold a Trans Med Sup to a client last year (Feb 2019). Are they supposed to get some sort of tax form from Trans?
Client tax forms for Med Sups?
- Thread starter D.V.
- Start date
- 29,535
Yes. It's called a 1099-BS-LOL
billdozer
Expert
No, there is no form. They can claim the medical deduction for the supp but it's not going to mean anything if they don't have more than 7.5% of the AGI in medical costs.
- 4,619
exactly. And also wont mean anything for the majority of seniors even if they did have more than 7.5% of AGI in medical expenses as they don't itemize deductions, especially now that the standard deduction for a married couple over age 65 is almost $27k
Even before standard deductions jumped in 2018, I believe less than 20% of seniors itemized deductions. very few, if any seniors have $27k as a couple in prop taxes, interest, charity, excess over 7.5% medical expenses. Tax preparers charging all those seniors to file tax returns they are not required to file are making some very good money shuffling a couple of stacks of paper
- 6,497
Caveats:
Not an insurance agent.
There are statements in the internet which will contradict what I am going to say.
I do not believe premiums for Medicare Supplement Insurance are deductible medical expenses for income taxes.
Not an insurance agent.
There are statements in the internet which will contradict what I am going to say.
I do not believe premiums for Medicare Supplement Insurance are deductible medical expenses for income taxes.
Last edited:
- 4,619
I don't believe that is accurate. See following IRS link for the publication specific to what is allowed as a medical expense, Medicare supplements are clearly mentioned on page 9. Even though they are considered to be deductible by IRS doesn't mean they are deductible by the taxpayer because the person has to first have more than 7.5% of their AGI spent in allowable medical expenses & even then, the taxpayer still has to have enough other total deductions to exceed the standard deductions. So, for most taxpayers, medicare supplements are not actually deductible. Very confusing to say the least: https://www.irs.gov/pub/irs-pdf/p502.pdf
- 6,497
the reason our posts crossed above is that I had delayed my response here because of searching for some information.
The specific list of QME's in pub 502 did not include Medicare Supplement premiums in the "Medicare" area of the listing. Pub 969 specifically excludes them for purposes of qualified HSA withdrawals.When I put those two things together, I would not put my own signature on a tax return that included Medicare Supplement premiums as a deduction.
As I said, there are blog posts on the net that disagree with that opinion.
If I did a lot of high dollar tax returns for a living, I would pay to have access to CCH reference materials and would search them for further information on this issue.
- 4,619
publication 502 appears very clear. it states in the "insurance premium" area that premiums covering medical & prescriptions are QMEs. it then pretty clearly calls Medicare Part B & D also QMEs.
Later, in the long list of items that are not QMEs, it never states anything about Med Supp plans and it calls our many much more obscure items as not QMEs.
regardless, this really comes into play very rarely, but I understand your caution
- 6,497
The very rarely comment seems reasonable to me.
I agree that Med Supp plans/premiums don't seem to be mentioned in Pub 502. However Pub 969 suggests something like HSA eligible expenses are generally QME's and then under insurance premiums specifically excludes Medigap premiums as HSA eligible. That just leads me to wonder if there is something buried in the CFR (Code of Federal Regulations) somewhere that excludes Medigap premiums from QME eligible insurance premiums. I couldn't come up with any quick search ideas that would get me further information.
So you started out by saying supps are clearly mentioned to saying nothing is said about them? On pg 9 if you're talking about under Part B being a supplemental medical insurance, that's just the official name for it -- SMI. You'll see references for it all throughout SSA documentation. It's not the same as a Medigap plan. No comment on whether or not the premium is deductible or worth trying to deduct.
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