Medical deduction for cost of Long Term Care/Nursing facility for Alzheimer’s patient
I'm trying to help my sister-in-law with her tax return. Her husband was diagnosed over a year ago with early onset Alzheimer's/dementia. It was necessary for him to move to a long term care/nursing facility in November as she could no longer care for him. They pay the monthly fee in full. My question is,is that cost deductible (exceeding 7.5 of adjusted gross) when itemizing? Pub 502 is not clear and I have been unsuccessful in reaching the IRS for telephone help. Thank You.
Terry Says
OK, I'm not qualified to give specific tax advice. I know you can deduct medical care amounts over 7.5% of AGI if you are 65 or older. She can't claim a dependent care credit if her husband resides full time in assisted living. In this case, I would recommend having her tax return done by a Certified Public Accountant to make sure she gets all relevant deductions. But there could be some financial planning aspects that would allow her to keep her home and some assets (depending on the state of residence) and still file for state Medicaid programs to cover the cost of care so she is not impoverished. It is important to get professional legal advice on this, as well as tax advice for their current return. Here is a link to the national directory of state elder care resources. Many states provide free tax returns for seniors. For planning re Medicaid, I have several resources. Start with http://lawelderlaw.com/ Or go to www.NAELA.org, which is the website of the National Association of Elder Law Attorneys. There you can search for attorneys in your state, because Medicaid is basically a state program -- and each state has different rules regarding the assets the "well" spouse can retain.
