Is Assisted Living Tax Deductible?

Assisted living can be a wonderful option for seniors who require some extra support and care in their daily lives. Not only does it provide a comfortable environment, but it may also be a tax-deductible expense for those who meet certain criteria.

What Expenses are Tax Deductible?

When you or your loved one require assistance with at least two daily living activities (DLAs), such as bathing, dressing or eating, you may be eligible for certain tax deductions on your medical expenses associated with assisted living. To qualify for these deductions, you must obtain certification from a licensed healthcare practitioner, such as a nurse or doctor. Examples of DLAs include, but are not limited to:

Bathing
Dressing
Mobility
Toileting
Transportation to and from medical appointments
Medication management

What Expenses are Tax Deductible?

Bathing
Dressing
Mobility
Toileting
Transportation to and from medical appointments
Medication management

Under the Internal Revenue Code (IRC) Section 213:

If you or your loved one live in a senior living community primarily for the need and availability of medical care, then all or substantially all of the amounts paid to the community are fully deductible.
If you or your loved one live in a senior living community primarily for personal or family reasons, only the portion of fees related to medical care on your taxes can be deducted.

In either case, the costs must actually be paid during the tax year and not be reimbursed by another party.

It's important to note that the Internal Revenue Service (IRS) has specific guidelines and limitations for these deductions, so it's recommended to consult with a tax professional or financial advisor to determine eligibility and maximize potential benefits.

Additional Criteria

You or your loved one must meet additional criteria to be eligible for this deduction, such as:

The taxpayer must be authorized to itemize their deductions
Long-term care services and any other medical expenses that are not reimbursed must surpass 7.5% of the taxpayer's adjusted gross income¹

Also, you may be able to claim deductions for the medical expenses of your parent if you cover over half of your parent's support expenses.

How Can Brookdale Help?

Our Brookdale assisted living and Alzheimer’s and dementia care communities have a licensed nurse on staff who provide individually customized plans for you. We start with an assessment to learn how we can support you. We then utilize that assessment to create your personalized service plan so we know what you need, while letting you maintain your independence. This personalized assessment may meet the certification requirement.

However, for your tax files, we recommend that you obtain a letter from a licensed health care practitioner, outside your Brookdale community, addressing the health condition of the resident.

¹https://www.irs.gov

Brookdale Senior Living cannot and does not provide professional tax advice. The above content is shared for educational and informational purposes only. The content is not intended to be a substitute for professional tax or financial advice and should not be relied upon for making tax, financial or other decisions. Please consult your attorney, tax advisor or financial advisor before acting on any content herein.