Carlos, age 45, and Julie, age 41, are married and will file a joint return....

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Accounting

Carlos, age 45, and Julie, age 41, are married and will file a joint return. They have two children, Andrea and Roberto, whom they will claim as dependents on their joint return. Julie's cousin, Sergio (age 32), came to live with them in August 2016. Sergio's gross income was $4,200. Julie and Carlos did not provide over one-half of Sergio's support for the year but did pay $700 of Sergio's medical bills in October 2016. Carlos was enrolled all year in an HDHP with family coverage. Carlos has had an HSA for five years. He has no other health insurance. In 2016, Carlos made regular contributions to his HSA totaling $3,500. In 2016, Carlos took $1,600 from his HSA to pay the following medical expenses: $200 for over-the-counter allergy medicine for their daughter, Andrea (no prescription from doctor) $475 for Roberto's physical therapy sessions. $300 to purchase Julie's eyeglasses (needed for medical reasons) $625 for long-term care insurance for Carlos Carlos, Julie, Andrea, Roberto, and cousin Sergio are all U.S. citizens and have valid Social Security numbers. 11. What is the total amount of unqualified medical expenses paid by Carlos for HSA purposes? A. $0 B. $200 C. $475 D. $625

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