Author: Andrea Miller
Reviewed By: Rachel Rose

Some assisted living expenses are tax deductible. The IRS allows you to deduct the medically necessary portion of care and services received. For example, if your doctor says you need help getting in and out of bed, mobility assistance would be deductible.

How do you deduct assisted living expenses?

Use IRS Schedule A (Form 1040) to deduct assisted living expenses. This form, Itemized Deductions, asks you to list deductible medical and dental expenses. Keep in mind that you can’t deduct these costs if you take the standard deduction on your tax return.

To claim the deduction, expenses in this category must exceed 7.5% of your adjusted gross income. If your AGI is $100,000, medical expenses become deductible once you spend more than $7,500 in this category. The IRS defines AGI as all sources of gross income, including capital gains, dividends and wages, minus specific adjustments.

What types of assisted living expenses are deductible?

Some tax-deductible assisted living expenses include fees you pay to healthcare providers, insurance premiums for long-term care, transportation for essential medical care, medical devices, and prescription drugs and medications. Fitness center fees at an assisted living center qualify for tax deduction when a doctor prescribes physical activity for a condition such as obesity.

Document these expenses carefully to have the necessary information to claim the available deductions at tax time. Ask the assisted living community for an itemized bill that distinguishes medical services from other types of care.