By Thomas J. Holmes, JD
Chief Tax Specialist, Co-Founder, and Partner at Joseph Cahill & Associates / WorthTax
Seniors often face the prospect of entering a nursing home to receive long-term care. At other times, the senior will remain at home and receive some type of assistance with his or her everyday activities. Both of these options can involve considerable expense to the senior. As a result, care should be taken to claim every tax deduction available in these situations to help abate the costs.
Deductible expenses include the entire costs for medical care, meals and lodging for a nursing home resident, provided that the main reason for being in the nursing home is to obtain medical care. Otherwise, only the portion of the expense actually spent on medical care is deductible. For a senior receiving services at home, maintenance and personal care expenses, such as cooking and cleaning, are deductible.
In both situations, the person receiving the services must be a chronically ill patient and the services must be prescribed by a licensed health care practitioner. A chronically ill patient is (1) one unable to perform at least two of the following daily tasks without substantial assistance from another person for a period of at least 90 days: eating, toileting, transferring, bathing, dressing and continence or (2) one requiring substantial supervision to be protected from threats to health and safety due to severe cognitive impairment.
The person providing the services need not be a registered or trained nurse, but if the service provider is a spouse, child or parent of the patient, such relative must be licensed to provide such services.