7:02am -0000 05/12/26 Ed Greenberg <[email protected]> wrote: >I would take these late reimbursements as a Contra sub account underneath >medical expenses. Maybe call it reportable late reimbursements or whatever >will mean something to you. I believe there is a checkbox that causes >particular accounts to show up on a tax report.
Right. That was my initial reasoning, but I cannot link a contra expense account to an income category on the tax report. It doesn't change taxes owed, but IRS wanted the recovery reported as income and not used to reduce the medical expense on Schedule A. So it matches reporting for the tax return, I book reimbursements in two places. If received in the same tax year the expense was paid, it's a contra expense. If received in a later tax year, Other Income > Recoveries > Reimbursements medical and drugs > Includible "Includible" is tax mapped to Other Income. If an excludable recovery is received in a later tax year for an expense that wasn't deducted, its subaccount won't be tax mapped. >On Tue, May 12, 2026, 06:47 Adam H. Kerman <[email protected]> wrote: > >> Here's a bookkeeping issue I ran into that affects a 2025 tax return. I >> confess that, even though the numbered schedules have been part of the >> Form >> 1040 layout since the 2019 tax year, because they keep changing from year >> to >> year, I am still not used to them. >> >> I made a reporting mistake but it doesn't affect taxes owed so I won't >> amend >> the return unless questioned by IRS. >> >> There were medical expenses taken as itemized deductions in 2024. They >> were >> reimbursed by insurance in 2025. At first, I took them as contra expenses >> against the insurance premiums, but that seemed wrong, so I took them as >> general contra medical expenses. >> >> After filing the tax return, I found discussion of "recoveries" in >> Publication 525. A recovery is a return of an amount taken as a deduction >> or >> credit in a prior year, and includes reimbursements of medical expenses. >> The >> recovery is includeable as income to the extent to which there had been a >> tax benefit in a prior tax year. For instance, if the standard deduction >> had >> been taken in 2024, then the recovery of the medical expense isn't >> included >> as income. >> >> Going forward, then, I shall not take these as contra expenses if received >> in a later tax year. I'll have two separate income accounts, includeable >> and >> excludeable, with tax-line mapping for includeable only. But I'm still >> taking a reimbursement received in the same tax year as the expense as a >> contra expense. >> >> The includeable recovery is reported as Other Income on Line 8z, Schedule >> 1. >> >> That the reimbursement gets treated differently for income tax purposes >> depending upon the tax year in which it is received complicates >> bookkeeping, >> but of course there is no choice. >> _______________________________________________ >> gnucash-user mailing list >> [email protected] >> To update your subscription preferences or to unsubscribe: >> https://lists.gnucash.org/mailman/listinfo/gnucash-user >> ----- >> Please remember to CC this list on all your replies. >> You can do this by using Reply-To-List or Reply-All. >> > _______________________________________________ gnucash-user mailing list [email protected] To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user ----- Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
