Monday, May 02, 2011 victor0victor0, Community Member, asks

Q: Is Dementia Care Tax Deductible?

My father is in an assisted living facility with a "memory care unit" which cares for people with alzheimers and dementia. My father is diagnosed with dementia. The facility fees largest line items are "personal care services" and "rent" "Rent" includes room, meals, housekeeping, and a basic level of care. Are all my father's facility fees tax deductible?
Answer This
Answers (4)
Carol Bradley Bursack, Health Guide
5/ 4/11 9:32am

Nina made some very good points. I would also suggest that you have a CPA examine the expenses. Be sure to keep all receipts. If you are personally paying for the care, and it is over a certain percentage of your income, you may be able to deduct expenses. You want to be very certain what you do is IRS friendly, so I'd strongly suggest an expert.

Best,

Carol

Reply
NC, Community Member
5/ 2/11 6:12pm

My father-in-law's residential care sent us explanation on the tax. They are not responsible for this but they explained their position.

Basically, if it is home care, the caregiver's salary is tax deductible provided that for each year, a doctor writes and proofs that he has dementia or Alzheimer's and he cannot take care of himself at all.

However, food and lodge cannot be tax deductible in the nursing home unless you can get a doctor telling IRS that he needs medical care with the disease such as heart disease or cancer and so on. This means the caregivers/managers' fees or operation fees are tax deductible provided that he is incompetent. Usually the home would give you a percentage on that to separate that from the lodge or food.

We did everything. I reported all of the nursing home expenses saying my FIL needs medical care and we got the refund.

 

Good luck,
Nina

Reply
AFA Social Services, Health Guide
6/10/11 10:37am

This is an excellent question.  The short answer is quite possibly. According to the IRS, if your father's long-term care medical expenses are such that they exceed 7.5% of his ‘adjusted gross income', then these expenses (the amount over 7.5%) can be deducted.  You can get more information from the IRS:  http://www.irs.gov/pub/irs-pdf/p502.pdf  It is also recommended that you double-check with an accountant before filing.

Reply
NC, Community Member
6/10/11 2:46pm

7.5% is calculated in IRS by form 1040 Schedule A.

 

Everyone says to check with CPA. It is true CPA can make sure you  don't make any errors. Once you get the idea on how to do this, it is not hard at all. No need to use a CPA every year and waste money.


Nina

Reply
Carol Bradley Bursack, Health Guide
6/13/11 12:21pm

Good point, Nina, all though tax laws are always changing. Some people are much better at keeping up with these changes than others. I am always more comfortable with a CPA, but then I'm not great with numbers. With today's software, a lot more people do their own taxes. As long as this person keeps up with IRS changes every year, then they are probably okay. Still, a CPA stamp is a good thing when it comes to audits.

 

You have been amazing with all you've learned!

Carol

Reply
NC, Community Member
6/13/11 1:48pm

Hmm, Carol, never thought of this: CPA stamp and audits. Well it makes sense!

We seeked on CPA the first time and the guy was strange: he was like it is so easy, and you can do it yourself! Didn't seem eager to get this job???

 

Nina

Reply
Carol Bradley Bursack, Health Guide
6/13/11 2:11pm

That is odd! I think I'd find another CPA if I needed one. We kind of like to feel they want our business : ) 

 

We always appreciate your input so much!

 

Take care, Nina.

Carol

Reply
Answer This

Important:
We hope you find this general health information helpful. Please note however, that this Q&A is meant to support not replace the professional medical advice you receive from your doctor. No information in the Answers above is intended to diagnose or treat any condition. The views expressed in the Answers above belong to the individuals who posted them and do not necessarily reflect the views of Remedy Health Media. Remedy Health Media does not review or edit content posted by our community members, but reserves the right to remove any material it deems inappropriate.

By victor0victor0, Community Member— Last Modified: 10/26/11, First Published: 05/02/11