Make sure you take the deduction for your medical expenses, if you qualify.

The IRS allows you to deduct a portion of your medical expenses. The amount that exceeds 7.5% of your adjusted gross income (AGI) can be deducted. Report the deduction on Schedule A, as an attachment to Form 1040.

1. Calculate your AGI by completing the first page of Form 1040. The figure you have at the bottom of the page is your AGI. Simply stated, It is your income less certain allowable deductions.

2. Multiply your AGI by 0.075 to calculate 7.5%. For example, if your AGi is $60,000 your medical expenses will need to be more than $4,500 to take this deduction.

3. Get out those receipts and tally your medical expenses. If they are greater than your 7.5% calculation, include them! To continue the example above, if your medical expenses were $6,000 you could include $1,500 on your itemized deductions.

Include cost you pay for out of pocket like doctor appointments, equipment, supplies and diagnostic devices such as diabetes testing kits. You can also include insurance premiums, co-payments, and the amount paid for long-term care. If you paid medical expenses for a spouse or dependent, include those figures too.

Don’t short change yourself. Include all applicable expenses. There is even a way to include transportation to and from your medical appointments. Here’s a brief sample.

INCLUDED
Acupuncture
Contact lenses
Braille books and magazines
Fees to a Christian Scientist practitioner for medical care
Fertility enhancement

Unfortunately, we cannot deduct all the expenses we may consider medical. For example, don’t try to slip these by the IRS.

NOT INCLUDED
Vitamins
Vacations for general health and wellness
Baby sitting childcare, and nursing services for a normal, healthy baby
Cosmetic surgery
Health club dues
Dancing and swimming lessons

Remember, the IRS will hold you responsible for knowing which expenses can and cannot be included. For to the comprehensive list refer to IRS publication 502. If you can’t locate the answer to your question, contact your trusted tax professional.

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Allison Einbinder has been preparing taxes for thirteen years and is the owner of Dollars & Sense Taxes & Accounting.

While I generally advise clients to keep their tax returns for seven years, it doesn’t always happen. If you can’t locate or retrieve your tax records don’t fret! The IRS can provide transcripts and copies of documents you’ve files and information about your account.

The IRS can provide two replacement documents, a tax return transcript and a tax account transcript. First determine which document you need, as they vary greatly.

A tax return transcript shows the majority of your tax return including any attached schedules and forms. This document should contain the exact data as you reported it. However, it does not show changes or payments made after the return was filed. (Most financial institutions will accept this document as verification of your income.)

Tax return transcripts are free and the IRS mails them within 10-15 days of receiving your request. The IRS may not be able to provide information on returns filed more than 6 years ago.

A tax account transcript shows any adjustments made after the return was filed. It also includes your basic information, including filing status, adjusted gross income, and taxable income.

Tax account transcripts are also free. They are usually available for the current year and three calendar years prior. Tax account transcripts can take up to 30 days to receive

Obtaining either document is easy. Simply call the IRS at 1-800-829-1040. Their automated system will process your request. Or request your transcript via the mail using Form 4056-T, Request for Transcript of Tax Return.

If the tax return and tax account transcripts don’t include the information you need, there is one more option. Use Form 4506 to order an actual photocopy of your tax return. This takes up to 60 days to process and costs $39.

I hope you’re enjoying this season’s Tax Tidbits. Visit Queercents tomorrow for more helpful financial information.

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Allison Einbinder has been preparing taxes for thirteen years and is the owner of Dollars & Sense Taxes & Accounting.

April 15th passed and my friends’ father had not paid his taxes. October 15th passed and he still had not paid his taxes. Not too long after, the IRS sent a request for his tax return. He, being the polite gentleman he is, responded with a simple letter. It stated he was not paying his taxes “as a conscious objector to this illegal war in Iraq.”

Care to guess what happened next? Well, within days of receiving the notice, the IRS froze his bank accounts. They withdrew the amount they assessed in full immediately. He sealed his own fate by specifically stating that he refused to pay his taxes. Had he not made that statement, the levy might not have taken place—at least not as quickly.

Don’t rush to add levies to your list of nightmarish images of the IRS. They usually levies only after three requirements are met:

1. They assess the tax and send you a Notice and Demand for Payment;
2. You neglected or refused to pay the tax; and
3. They send a Final Notice of Intent to Levy and Notice of Your Right to A Hearing (levy notice) at least 30 days before the levy.

If you receive notification from the IRS, be careful. Figure out a way to clearly understand what they are requesting and be prompt in your reply. Also be aware of the consequences of your response!

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Allison Einbinder has been preparing taxes for thirteen years and is the owner of Dollars & Sense Taxes & Accounting.