Individuals that live in assisted living facilities may able to deduct some of their expenses from their taxes. Costs for medical expenses, including some long-term care expenses, that make up more than 10 percent of your adjusted gross income (or 7.5 percent–through 2016–for taxpayers over 65) are tax deductible.
Who Qualifies?
To qualify for the tax deduction, a nurse or doctor must certify that a resident:
- Is unable to perform at least two daily living activities (e.g., bathing, dressing, toileting, etc.)
- Requires constant supervision due to a cognitive impairment
Personal care services must be provided according to a plan of care prescribed by a licensed health care provider. Room and board can only be tax deductible if a resident is chronically ill and is in the facility primarily for medical care administered according to a certified care plan. Residents who do not have chronic medical conditions may still be able to deduct the portion of their expenses that are attributable to medical care.
A qualified tax attorney or accountant may be able to advise you on what portion of your assisted living expenses are tax deductible. If you have an elder law attorney, he or she may be able to refer to a qualified tax advisor in your area.
