If an insurance company reimburses the insured for medical expenses, can the insured deduct that amount from their federal income tax?

When an insurance company reimburses the insured for medical expenses, that reimbursement typically isn't deductible from the insured's federal income tax. In general, medical expenses that have already been covered by insurance are not eligible for deduction because taxpayers can only deduct out-of-pocket expenses that exceed a certain percentage of their adjusted gross income. Therefore, if a claim is reimbursed, it has not been incurred as an expense by the insured and, hence, does not qualify for a tax deduction.

For tax purposes, only the portion of medical expenses that is actually paid out-of-pocket by the insured after accounting for any reimbursements is considered. This aligns with the principle that taxpayers cannot benefit from deductions on expenses that they do not ultimately incur, ensuring that the tax code prevents double-dipping on deductions and reimbursements. Other options may introduce conditions under which deductions could apply, but they do not align with the standard practice regarding medical expense reimbursements.