How we’re responding as our vaccination rates rise.
As tax documents begin to arrive in the mail, many people are looking back at 2011 and doing some mental accounting before filing - what will you have to pay taxes on, and what will you possibly get a return from?
There is some good news for people living in a senior living community or those who are supporting a senior receiving this type of care. Under the federal Health Insurance Portability and Accountability Act (HIPAA), the entire monthly cost for assisted living may be tax deductible as a medical expense.
According to this act, the cost of maintenance or personal care services can quality for a tax deduction when they are required by someone who is unable to perform at least two activities of daily living or who has severe cognitive impairment. These services must be pursuant to a care plan prescribed by a licensed healthcare professional. Seniors who are receiving Alzheimer's care at an assisted living community may be classified in this way, making them eligible for this tax opportunity.
Family members who are helping a senior pay for assisted living may also qualify. If you provide more than half of a senior loved one's total financial support for the calendar year, you can claim that individual as your dependent and deduct these medical expenses on your tax return. Talk to your tax advisor to further explore this opportunity.