Mom has social security ($1000) and a pension ($700) and dividend income and capitol gains and withdrawal from IRA, all of which are taxable incomes. Is the full fee for assisted living plus the homecare agency at the AL plus the outside companions deductable as a medical expense? (Yes I have an accountant, and his position has been that yes it is, which seems almost too good to be true). Has anyone other experience with this? Or other information? I have searched online and read what I can, and I also use turbotax to do a draft each year before I send to the accountant, but I still feel that we may be audited in the future. Some of the expense in the AL is for housing rent and for food and utilities, it seems to me. Is that 'medical' because she needs to be there?
Companions NO, but aides that provide a service as ordered by the MD, yes.
If you don't have Publication 502 and can't get it from a library, either ask your accountant for a copy or order it directly from the IRS. It will provide more detail and guidance on determining deductible items.
NYDIL is right, especially about the 100% defensible position.
"AGI threshold. You include all the qualified medical costs that you paid for during the year. However, you can only deduct the amount that is more than 10 percent of your adjusted gross income.
•Temporary threshold for age 65. If you or your spouse is age 65 or older, the AGI threshold is 7.5 percent of your AGI. This exception applies through Dec. 31, 2016."
https://www.irs.gov/uac/Claiming-a-Tax-Deduction-for-Medical-and-Dental-Expenses
Example, last year my Dad had caregivers in his home to help him because he was a fall risk and had major issues going up and down the stairs at his house. So, the CPA was able to deduct those costs. Plus deduct my late Mom's long-term-care, and deduct her brand new hearing aide.
But when 2017 rolls around to do the 2016 income taxes it a whole new ballgame as my Dad recently moved into Independent Living, and that is not deductible. The CPA will look next year to see if Dad could deduct the "extras" such as daily pill management.
Found out that my Mom over the past couple of years could have checked the box as being legally blind having serious macular degeneration. The CPA never knew this until he saw I had checked the box for being blind, and of course my Mom didn't want anyone know she was getting older... [sigh].