There are methods to save costs, whether you’re just starting to think about your living options and how they fit into your financial plan or you currently live in a living complex. While you might be able to offset certain costs by claiming long-term care insurance, veteran aid and attendance benefits, or community exemptions, it is a good idea to always seek other ways to get financial relief.
Examining potential tax deductions is one method some families and their dependents might offset the price of living in a senior independent living community. Every year, tax regulations change, but we’ve compiled information that may be useful to you and your circumstances. Of course, if you have particular questions, you should always speak with a financial or accounting professional.
Independent Living
Independent living expenditures are often not tax deductible. However, you might be eligible to claim a tax deduction for some expenses if you receive medical care from a home caregiver or caregiver. Only medical services rendered or rendered by home health care providers in this instance are deductible. These expert services might involve administering medicine, managing chronic diseases, or caring for wounds.
Assisted Living
Not all costs associated with assisted living are tax deductible. However, some service fees or prices could be. All you have to do is to get in contact with the retirement community, and the senior living advisors will be able to provide you with more information and the necessary steps to make the request. Do take note that you must fulfill a number of standards in order to be allowed to submit deductions for medical services.
You must first get a doctor or nurse’s certification stating that you require monitoring due to cognitive decline or disability or that you are unable to do at least two activities of daily living (ADLs) without help. ADLs include washing, dressing, using the restroom, eating, walking, and other forms of movement. You must also have a care plan indicating the support required if this criterion is satisfied.
If medical costs exceed 7.5% of your adjusted gross income, they may be deducted, including portions of subsidized living costs spent for help and treatments. In many instances, the whole monthly cost is deducted as “medical expenditures” if it meets the requirement that it represents at least 7.5% of your adjusted gross income.
Memory Care
Similar to other expenses, memory costs could be tax deductible. The criteria for assisted living and itemized medical expenditures are the same. You must receive assistance with at least two daily living tasks or with cognitive impairment, similar to assisted living. Medical costs are deductible if they total more than 7.5% of the person’s adjusted gross income.
Skilled Nursing
Additionally eligible for a deductible as a medical cost are skilled nursing services that are not covered by Medicare. The whole cost is regarded as deductible as a medical expense if the person is in a nursing community and qualifies for medical treatment.
