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Don’t deduct FSA contributions twice

by on
in Small Business Tax

Q: I experienced unusually high medical expenses in 2003. In addition to my out-of-pocket costs, I contributed $2,500 to my company flexible spending account (FSA) and used up all the funds. Can I count those FSA expenses as deductible medical expenses? J.B., Winslow, Ariz.

A: No. Your $2,500 FSA contribution will be reflected on your W-2 as a $2,500 reduction in your salary for 2003. So, in effect, you already deducted your FSA contribution. Therefore, you can't deduct the contribution again as an itemized medical expense on your 1040.

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