Practice Quiz

Health and Life Insurance

Category - Tax Issues

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If a person earns $50,000 per year and they own an individual health insurance policy, how much would that individual need to spend on his or her medical expenses in order to deduct such expenses on their tax return?
  1. $7,500
  2. $5,000
  3. $3,750
  4. $2,500
Explanation
Answer: C - If a person earns $50,000 per year and they own an individual health insurance policy, they would need to spend at least $3,750 on medical expenses in order to deduct such expense on their tax return. This is because $3,750 is 7.5 percent of $50,000. This is calculated as $50,000 x 7.5% = $3,750.
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