roblem 5-15 (Algorithmic) Medical Expenses (LO 5.6) Linda installed a special pool for the hydrotherapeutic treatment of severe arthritis, as prescribed by her doctor. The cost of installing the pool was $23,360, and her insurance company paid $5,840 toward its cost. The pool increased the value of Linda's house by $8,176, and it has a useful life of 10 years. How much of a deduction (before any AGT limitations) is Lnda entitied to in the year of installation of the pool? x roneck Mr Widk Medical expenses are the first itemized deduction on Schedule A. Taxpayers are allowed a deduction for the medical expenses paid for themselves, their spouse, and dependents. - Expenses that are deductuble as medical expenses include the cost of items for the diagnosis, cure, mitigation, treatment, and prevention of disease. Also included are expenditures incurred that affect any structure or function of the body. Payments for special equipment purchased and installed in the taxpayer's home for medical reasons may also be deductible. Unreimbursed medical expenses can only be deducted to the extent that they exceed 7.5 percent of the taxpayer's AGI