Those who unfortunately have enough medical expenses to itemize -

[rafiki]

.

[merry gardens]

Michele--have you looked at flexible spending accounts? Some employers offer them. Special education expenses are listed as services that can be reimbursed via flexible spending accounts. http://www.irs.gov/publications/p502/ar02.html#en_US_publink1000179012

 

FSAs take money out of an employees paychecks before taxes--so you don't pay tax on it. You have to plan ahead and guess how much you'll spend for the year and the employer has to offer this option. I have a love/hate relationship with it. You have to jump through their hoops to get reimbursed with your own money and if there's money unspent in the account you could loose it--but a lot of people just get new glasses and contact supplies in December if there's money left in their account.

[homeschoolmom97]

Michele - I'm right there with you!!!

 

Because I'm too cheap to buy and use something like quicken, I end up creating a spreadsheet at tax time. I throw all my tax deductible paperwork into a separate file folder during the year, and that, along with my check registers and credit card bills, is what I use to put the spreadsheet together.

 

On the spreadsheet, I separate the expenses by type - insurance premiums, doctors, dentists, other health provider, health facilities (hospitals, etc), lab, prescriptions...I haven't separated them by person or date, although as a practical matter when I sort through it at year end I end up putting it in date order...We use tax prep software, so I sort according to their categories.

 

I hear that mint.com is a good free software for people to track their budgets, but I'm a little nervous about putting my financial stuff out there on someone else's site...even though it's supposed to be really encrypted.

 

I keep all my bills and receipts, and I triple check my providers' bills against my Explanation of Benefits (EOBs) from my insurance company before I pay any bills (I learned the hard way how important it is not to pay anything until you hear from your insurance...). The bills get stapled to the EOB after I've reconciled them. It's all a pain, but when I didn't do this, I found a couple times that I had gotten over-billed by the provider...:glare:

 

One other thing I did last year that helped was I used a highlighter in my check register and on my credit card bills to highlight deductible expenses as they happened - it helped me find a couple holes where my filing system had broken down, and I had to go hunting for the bill.

 

Not saying any of this is right - it's just what works for me...

 

Golly, I yearn for the day when we DON'T have enough to itemize...:tongue_smilie:

[Dana]

We had two years when we could itemize and include medical expenses.

I used a spreadsheet to track it.

Don't forget that you can also get mileage allowances :) (or you could those years... I got good at attempting to read tax code... but really, they should require the writers to diagram those sentences!)

 

We were never audited, so I didn't have to prove anything.

 

I did have the insurance statements, credit card receipts (went in a different file than other receipts), and any doctor bills. For my organization, the spreadsheet is per person with date of service & charges. (This is also how I track medical bills now to see what insurance has paid and what we owe.)

[SonshineMama]

We itemized until we realized almost all of our providers would discount us due to our finances or my son's diagnosis. ;)

 

How I itemized.

spreadsheet with the following tabs

*log of appointments (and location - usually they just repeat over and over so I can quick calculate mileage)

*payments, dates, check #'s

 

All insurance statements

Check stubs for payment.

 

I rubber banded the whole thing and put it in a file with my taxes.

[Finnella]

We track it in Quicken, though thanks to the FSA we haven't been able to deduct for the past few years. But with Quicken, we can check every year to be sure.

 

If we didn't have Quicken, I'd definitely use a spreadsheet and track it by the same categories that you'll use on the tax return.

 

I get an accordion folder for each year's taxes. That way I can keep all the paper back up for medical expenses. But it's also because my husband is sometimes self-employed. It lets us keep all the paper proof, along with the actual tax returns. Oh for the days when my tax return copy went into a skinny file.