How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask Jacob Seamans Your Own Question

Jacob Seamans
Jacob Seamans, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 0
Experience:  Certified Public Accountant
25884411
Type Your Tax Question Here...
Jacob Seamans is online now
A new question is answered every 9 seconds

I live in Houston, TX. I have been on disability and have

Customer Question

I live in Houston, TX. I have been on disability and have been receiving monthly non-taxed $3040.60 (60% of my original salary) since January. I received a bonus in March 2011 for the previous year's work, which was already taxed. I have been going to MD Anderson for medical treatment. Due to a misunderstanding my company revoked my health insurance on March 31, 2011. I did not receive this news until June, so I was still going to the doctor. Just recently, MD Anderson (the famous cancer facility) sent me a $12,618.00 bill for visits and procedures done after March 31, 2011. MD Anderson gave me basically two options. I can set up a payment plan with them and pay the full asking amount over time or I could pay a lesser amount (example: what the insurance company would agree to pay them. Typically way less of course maybe 80%). I would have to pay in full now in 2011 if I wanted to pay the lesser amount. Since I have not paid taxes on the monthly $3,040.60, I will have to pay the IRS in April. My question is. . . is it smarter to pay the lesser amount of medical bills in 2011 in order to get a deduction from my taxes in April or should I wait and pay the higher bill on a payment plan?

On a more personal note, they have still not diagnosed me after all of this time, so they are basically asking me to "buy a car" for nothing. I am still sick. I will have health insurance again starting January 2012.

Any help would be greatly appreciated. Thank you.
Submitted: 3 years ago.
Category: Tax
Expert:  Jacob Seamans replied 3 years ago.

Hi, I can help you with your question.

 

Paying the full (20% less) amount in 2011 would provide you a savings of $2,523.60, without considering the medical expense tax deduction.

 

Alternatively, using a payment plan to pay the full $12,618 would allow for a 20% greater deduction on the combined tax returns for the years in which the plan covers. Please note, however, the deduction is only available for taxpayers who itemize their deductions. The increased deduction would then only provide a percentage (35% or less) of the $2,523.60 mentioned above.

 

Assuming funds are available, paying the full (80% less) amount in 2011 would provide the most savings.

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Last | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
 
 
 

Meet The Experts:

 
 
 
  • Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
< Last | Next >
  • http://ww2.justanswer.com/uploads/KU/KUMI95/2013-9-30_195031_kumar.64x64.jpg Wallstreet Esq.'s Avatar

    Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
  • http://ww2.justanswer.com/uploads/CU/Cuttinggirl/2011-10-29_03719_wcrop2.64x64.jpg Wendy Reed's Avatar

    Wendy Reed

    Enrolled Agent

    Satisfied Customers:

    3052
    15+ years tax preparation and tax advice.
  • http://ww2.justanswer.com/uploads/CATax/2009-08-04_204548_Mark.jpg Mark D's Avatar

    Mark D

    Enrolled Agent

    Satisfied Customers:

    985
    MBA, EA, Specializing in Business and Individual Tax Returns and Issues
  • http://ww2.justanswer.com/uploads/IN/insearchoftheanswer/2013-8-16_0233_attorney.64x64.jpg Richard's Avatar

    Richard

    Tax Attorney

    Satisfied Customers:

    3229
    29 years of experience as a tax, real estate, and business attorney.
  • http://ww2.justanswer.com/uploads/MY/MyVirtualCPA/2012-7-5_44024_cookmegan1.64x64.jpg Megan C's Avatar

    Megan C

    Certified Public Accountant (CPA)

    Satisfied Customers:

    6121
    Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
  • http://ww2.justanswer.com/uploads/JG/jgordosea/2012-6-7_43138_GordosVeritas.64x64.jpg jgordosea's Avatar

    jgordosea

    Enrolled Agent

    Satisfied Customers:

    2783
    I've prepared all types of taxes since 1987.
  • http://ww2.justanswer.com/uploads/OZ/ozaukeecpa/2012-6-7_193219_Picture1croppedandshrunk.64x64.jpg MequonCPA's Avatar

    MequonCPA

    Certified Public Accountant (CPA)

    Satisfied Customers:

    2231
    CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.
 
 
 
Chat Now With A Tax Professional
Jacob Seamans
Jacob Seamans
0 Satisfied Customers
Certified Public Accountant