What Medical Expenses Can be Used as Tax Deductions?

Tax season is nearly upon us, and we at SelectCare Home Care of NY wanted to share some tips that can help you not only get the care that you need, but increase your chances for a refund – effectively giving you a “rebate” on your home care through medical deductions.

Please keep in mind that this advice has been gathered from various web sources as a way to direct the reader to more comprehensive sources of advice – always speak to a tax adviser before filing.

When to claim a medical deduction

If your medical expenses amount to more than 10% of your adjusted gross income (7.5% if you are 65 or older), you can deduct some medical and dental expenses paid for by you or a dependent. To do so, you must itemize these deductions on your Schedule A (1040 Form).

Does home care count as a medical expense?

Yes, if you are considered “chronically ill” and home care is part of the plan of treatment drawn up by your physician.

The term “chronically ill” is a bit deceptive, and simply means that you cannot accomplish at least two activities of daily living (eating, toileting, transferring, bathing, dressing, and continence management) on your own for at least a 90-day period.

One important note: you can only claim deductions on services that you paid for within the year you are paying taxes for. For example, if you are filling out your 2015 taxes this year and pay for home care by check, you can claim any payment made with a check dated and signed within the year 2015.

What other medical expenses can be used as deductions?

The list is lengthy – spanning pages 5 through 17 of this publication by the IRS. Generally, any medical expense you incurred based on a doctor’s recommendation can qualify for a deduction, however things like bottled water, cosmetic surgery, or weight loss programs not specifically connected to an illness, cannot be deducted.

Of the dozens of possible medical deductions, there’s one major expense that is all-to-often overlooked: home modifications. If a loss of mobility or increased fall risk results in a doctor recommending changes to your home like shower bars, ramps or chairlifts, you can add these expenses to your 1040 Form.

What medical expenses CAN’T be used as deductions?

While the above-linked IRS document covers this information in detail, but here are a few major expenses you should NOT claim as deductions:

–        Diapers and other disposable medical equipment

–        Over the counter (nonprescription) drugs and medicine, even if your doctor recommends you take the medicine (think aspirin)

–        Household help (like a housekeeper) cannot be used as a deduction, even if seeking assistance is encouraged by your doctor. Only the assistance of a Home Health Aide, LPN, RN or other home care worker who is primarily responsible for your medical care can be considered for a deduction.

We hope you found this information helpful as April’s tax deadline draws near. We at SelectCare Home Care of NY are always looking for new ways to help our clients live within their budgets while enjoying the independence and safety that only our talented staff of home caregivers can provide. To learn more about how we can help you and your loved ones, call us today.