Following is an article I wrote for Ellenbecker Investment Group, Inc. I thought many of you might find it useful (and do not forget to gather your financial information throughout the year in order to help avoid tax time stress!):
Are you or a family member paying for assisted living or skilled nursing care? All or a portion of these expenses may qualify you for a medical expense deduction on your personal tax return! First, in order to itemize taxes using Form 1041 – Schedule A. Medical expenses exceeding 7.5% of your adjusted gross income qualify for the deduction. You might be surprised at the wide variety of deductions available. Take a look at the following list, and if any of the items apply to you, consult with your accountant or attorney. Allowable deductions include:
Medicare Part B and D premiums; long-term care insurance premiums for qualified policies; ambulance bills; annual physical exams; eye exams; glasses; surgery; hearing aids; artificial limbs; artificial teeth; bandages and medical supplies; oxygen; wheelchairs; body scans; x-ray costs; diagnostic services; car mileage to and from medical appointments; transportation to and from medical care such as bus, taxi, train fares; dental treatment; drugs (prescription, not over-the-counter); home care; hospital care; nursing care; personal care; assisted living facilities and nursing homes (includes the cost of meals and lodging if the principle reason for being there is to get medical care, and if the reason is not personal); advance payments for lifetime care (a nursing home deposit); capital expenses to install special equipment in your home for medical care (i.e. wheelchair ramps, installing grab bars, lowering cabinet doors, grading the ground outside the home to provide better access).
With health care costs continually rising, it benefits you to take the time to document the previous listed expenses and run the calculations. This is especially true for those on a fixed income. Whether your deduction is hundreds or more, ever little bit helps! Take the time to save your documentation!