Is Senior Assisted Living Tax Deductible?

The physical and financial burdens of aging can be crushing to senior citizens and their families. Assisted living facilities can help so much in relieving the stress of caring for the elderly who suffer from chronic medical conditions and disabilities, but these facilities are expensive to staff and upkeep. These facilities are not always covered under long-term care insurance. Knowing how to make the right tax deduction then becomes an important step to take for families in order to mitigate the costs of assisted living.

According to the Assisted Living Federation of America, the cost for a one bedroom apartment in an assisted living facility is over $3,000 per month, which is a high price for many elderly Americans to meet. In fact, many seniors cannot afford assisted living and must rely on family to meet their day to day needs.

Possible Tax Deductions

The government does offer a little help with these expenses in the form of certain deductions that lessen the tax burden on those in assisted living quarters. According to elderlawanswers.com, the rules for these deductions are quite strict and require a legal or tax professional to properly translate them:

• The IRS allows some long-term care expenses to be deducted under the heading of medical expenses if the amount comes to more than ten percent of a patient’s adjusted gross income. For those seniors who are already 65 or older, the percentage is 7.5 through the end of 2016.
• Living expenses, however, are only deductible under narrow guidelines. First, the resident has to be certified by a medical professional to be unable to perform at least two essential daily living tasks on his own. Tasks that fall into this category include bathing, dressing, eating, and continence. In addition, living expenses can be deducted for those with Alzheimer’s or some type of cognitive impairment. Also, an official care plan must be in place to allow for these expenses to be deductible.
• For chronically ill patients, some of the room and board expense may be deductible, though seniors in assisted living for custodial care and not medical care are probably limited to a smaller medical care deduction.
• When the elderly patient is a dependent of her family members, meaning they provide more than half of her support, the family may be eligible for a deduction. Even families who contribute 10 percent of a senior’s support may qualify for a small deduction.

As the folks at ElderLawAnswers point out, the tax code for assisted living residents is confusing, so professional help in preparing these tax returns is certainly a good idea. In essence, the government does provide some relief to those in assisted living, though the amount of that relief varies greatly.