What Assisted Living Expenses Are Tax Deductible?

Are you or a loved one considering moving into an assisted living facility? If so, you may be wondering about the tax implications of such a move. Specifically, are any of the expenses associated with assisted living tax deductible? The answer is yes, but it’s important to understand which expenses qualify and how to claim them on your tax return. In this article, we’ll explore the tax deductions available for assisted living expenses.

Understanding Assisted Living

Before we dive into the tax deductions, let’s take a closer look at what assisted living is. Assisted living facilities provide a level of care that’s somewhere between independent living and nursing homes. Residents typically have their own apartments or rooms and receive assistance with activities of daily living, such as bathing, dressing, and medication management. Assisted living facilities also typically provide meals, housekeeping, and transportation.

Medical Expenses Tax Deduction

The first tax deduction to consider for assisted living expenses is the medical expenses deduction. This deduction allows you to deduct medical and dental expenses that exceed 7.5% of your adjusted gross income (AGI) for the year. Assisted living expenses can be included in this deduction if they are considered necessary for medical care.

Qualifying Medical Expenses

So, what qualifies as a medical expense for tax purposes? According to the IRS, medical expenses are the costs of diagnosis, mitigation, treatment, and the costs for treatments affecting any part or function of the body. This includes the costs of equipment, supplies, and diagnostic devices needed for these purposes. It also includes transportation expenses primarily for and essential to medical care, amounts paid for qualified long-term care services, and premiums paid for long-term care insurance.

Assisted Living Expenses That May Be Tax Deductible

Now that we know what qualifies as a medical expense, let’s take a closer look at which assisted living expenses may be tax deductible:

1. Room and Board

The cost of room and board at an assisted living facility may be tax deductible if it’s necessary for medical care. This means that the facility must provide medical or personal care services to the resident that are necessary due to the resident’s condition. However, if the resident is in the facility primarily for social, recreational, or other reasons, the cost of room and board is not tax deductible.

2. Nursing Care

If a resident requires nursing care while living in an assisted living facility, the cost of that care may be tax deductible. This includes services provided by a licensed practical nurse (LPN) or a registered nurse (RN). The care must be necessary due to the resident’s medical condition.

3. Transportation

Transportation expenses related to medical care, including transportation to and from doctors’ appointments, may be tax deductible. This includes the cost of a caregiver accompanying the resident to medical appointments.

4. Other Medical Expenses

Other medical expenses that may be tax deductible include:

• Medications prescribed by a doctor
• Medical supplies, such as bandages and catheters
• Physical therapy
• Occupational therapy
• Speech therapy
• Dental treatment related to a medical condition

How to Claim the Deduction

To claim the medical expenses deduction, you’ll need to itemize your deductions on Schedule A of your tax return. You’ll need to keep receipts and other documentation of your medical expenses to support your deduction. It’s also a good idea to ask a tax professional to ensure you’re claiming the deduction correctly.

At Three Peaks Assisted Living, we understand that senior home care can be expensive, and we strive to provide affordable care options to our clients. Our experienced caregivers are trained to provide a wide range of senior home care services, from personal care to companionship and transportation. We work closely with our clients and their families to develop customized care plans that meet their unique needs and preferences.

If you are interested in learning more about our senior home care services or have any questions about the tax deductibility of senior home care expenses, please don’t hesitate to contact us. Our knowledgeable and friendly staff are always happy to help.