The IRS Deductions Blog

Archive for April, 2011

Question: car accident how to get my deductible back?

So I wanted some legal advice or at least a starting point. Long story short I was rear-ended by another driver (my insurance already completely determined it was not my fault) but the driver was not the owner of the vehicle…and though a police report was filed and my insurance has tried calling and writing both individuals (though in AZ the owner’s car insurance is to cover it) no response has been reached from either of them…which means my insurance did cover my car repair expenses, but I still had to pay my large deductible..
so how do I take legal action against either the owner or the driver to get my deductible back since none of it was my fault if the insurance can’t even get a hold of them?
any advice would be appreciated, I’m just confused what to do, where to do it, and how to do it against someone I can’t get in contact with…
It’s been just over a month now…and still no word from anyone…how long is too long if waiting is best?
deductible lost: $1,000.00

Answer: Since you paid the deductible to your company, they will go after the bad guy. You don’t ( and shouldn’t) do a thing. You “Hired” your company when you paid them the deductible. They are (will be) doing everything for you. They and their many lawyers will sue the bad guy if need be. They will get your money back for you. Simply contact them and ask what the status of the case is.

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Home Office Deduction

Question: How much money does the tax deductable for a home purchase save me?

I would like to understand the tax benefits of buying a house a bit better and how to do the math.

If I get a 400.000 loan over 30 years at a 5% interest rate, then my monthly payments will be somewhere between $2100 and $2300 (based on online mortgage calculators).

I understand that the interest on the loan is tax deductible part. Can anyone help me figuring out how much money that would save me per year?

Answer: The answer would depend upon your tax bracket. For example, if after other deductions you are in the 25% bracket, the tax savings would be the amount of interest paid that year times 25%.

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Question: health insurance question?

I’m looking into health insurance the plan has an annual deductible of $500 and an out of pocket limit of $10,000. Can someone please explain how that would work? and also for Obgyn checkups it says 20% after the deductible, please explain this too.

Thank You…No spam I will report you, serious answers only

Answer: health-quotes.talk4fun.net – my family have this health insurance. It is affordable and has good coverage for dental issues.

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Question: Hra account for MEDICAL insurance only?

Have you ever had an insurance with an HRA which means your employer pay’s the first say 1,000.00 of all your bills and then you pay a deductible and then the insurance kicks in 90%?

We have that now and I hope it works out well. If we dont end up using the hra it rolls over to the next year.

How did you like it? How much did you have in your hra?

ours i think is going to be 2000 per year we just got on it this year in the middle so we only got 1500

Answer: We have one now and I think here is $1500 in it. I have had a ton of tests done this year already for kidney stones and they’ve covered every part of it. I would say ours worked out well b/c they paid for everything and now I am getting laid off (nice, huh?). But think about it, if you are not giving birth or hopefully don’t have any pre-exisiting conditions that require a lot of testing, etc. then you should stay well below that $2,000 mark and then you will not have to pay any out of pocket (other than what they deduct from your check to cover the insurance). It’s not a bad deal in most cases

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Health Insurance : How Does Health Insurance Work in the Event of an Accident?

Question: Question about carrying two Major Medical Insurance policies on 1 individual?

My wife and I are having a kid and we both have HMOs from our individual employers. We both have high deductibles and ultimately similar coverage. A friend (who isn’t in the insurance business) recommended we double insure our new born son when he arrives just to insure he is covered should he have health issues. Is this legal and does it make sense to do it?

Answer: Do you have a high-risk pregnancy? If not, then over insuring for the small probability that something goes wrong and you hit the maximum’s on the insurance plan probably isn’t the best financial decision if you are both paying extra premium to add dependents and if both of these plans are “high deductible” plans.

You can legally do it and it’s called “Coordination of Benefits” (COB). The posters who have mentioned that one will be primary and one will be secondary (based on DOB of each spouse) are correct. You should also pay attention to the cost of your premium’s vs. the cost of hitting the “high deductible” on both plans. That’s potentially a LOT of out of pocket costs just to be “extra” insured.

The most important thing you are missing (IMO) however:
Is the doctor and hospital in which you plan to deliver covered by both plans networks? If not, then I wouldn’t even consider it.

If they do both cover it, here’s a quick example of how it can work. Let’s assume that yours is primary and your wife’s is secondary.

Each insurance company allows so much in charges by the doctor, so hypothetically let’s assume your that a routine exam will be “allowed” up to $100.

Your doctor then charges $75.00 an office visit and you have a $15.00 co-pay each time. That will cover it because it’s within the $100.00 “allowable charge” and you are still responsible for the co-pay.

Your wife’s insurance will NOT pick up the co-pay and only comes in as secondary if the charges exceed the allowable charge and there is money still owed after both the primary insurance and you have paid your applicable charges… and that’s assuming that the left over amount doesn’t also exceed the secondary insurers’ “allowable charge” which, in the spirit of insurance companies… is entirely possible and you can still be left holding the bill…

Hope that isn’t too confusing and good luck with having a healthy baby!!

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