Medical Savings Account

[indyscott]

My client has medical expenses exceeding the 7.5% amount. Her W-2 has an explanatory section with additional info, part of which is that her box 1 income has been reduced by $504 for a Medical FSA. That info doesn't show up in box 12, just in the supplemental info section for the employee.

My question is should I put that amount on line 16 in the Sch A Med worksheet in the box for "insurance reimbursement for above medical expenses"? Otherwise it would be double dipping, getting the funds into the account with no tax, and then reducing taxable income income again w/ a Sch A deduction.

The W-2 supplemental info also lists $1,408 as a reduction in income for "Other Cafe 125". I'm not sure if I s/ do anything with that at all..

[Janitor Bob]

My client has medical expenses exceeding the 7.5% amount. Her W-2 has an explanatory section with additional info, part of which is that her box 1 income has been reduced by $504 for a Medical FSA. That info doesn't show up in box 12, just in the supplemental info section for the employee.

My question is should I put that amount on line 16 in the Sch A Med worksheet in the box for "insurance reimbursement for above medical expenses"? Otherwise it would be double dipping, getting the funds into the account with no tax, and then reducing taxable income income again w/ a Sch A deduction.

The W-2 supplemental info also lists $1,408 as a reduction in income for "Other Cafe 125". I'm not sure if I s/ do anything with that at all..

I would say you are correct abount the $504....I do not think you need to do anything with the sec. 125 amount

[Bob Hoffman]

My client has medical expenses exceeding the 7.5% amount. Her W-2 has an explanatory section with additional info, part of which is that her box 1 income has been reduced by $504 for a Medical FSA. That info doesn't show up in box 12, just in the supplemental info section for the employee.

My question is should I put that amount on line 16 in the Sch A Med worksheet in the box for "insurance reimbursement for above medical expenses"? Otherwise it would be double dipping, getting the funds into the account with no tax, and then reducing taxable income income again w/ a Sch A deduction.

The W-2 supplemental info also lists $1,408 as a reduction in income for "Other Cafe 125". I'm not sure if I s/ do anything with that at all..

Section 125 is informational and provides a reconciliation between gross wages and taxable wages (just like 401 (k), 403 (B ), etc)