It’s tax time again, and you’re staring at a huge stack of medical bills, bank statements, and other documents, wondering what can be included in your tax deductions. For example: Are medical alert devices tax deductible? What about all those supplies and pills? Here are a few financial tips that can help you determine what you can claim.
Are You Giving Your 10 Percent?
Before you even look at itemizing and claiming medical deductions of any kind, make sure you meet a few criteria as the caregiver of a dependent adult. Add up any deductions you want to claim on those medical expenses that haven’t been reimbursed and make sure the total exceeds 10 percent of your adjusted gross income. If you or your spouse is over 65, a temporary exemption lasting until January 31, 2016, will allow you to deduct unreimbursed medical expenses that exceed 7.5 percent. (Note that the IRS does also state: “In 2017, the 10 percent threshold will apply to all taxpayers, including those over 65.”)
So the first thing you’ll want to do is ensure you have enough bills accumulated to make the hassle of itemizing and claiming medical expenses worthwhile. For most caregivers, that won’t be too much of a problem.
Do You Have to Keep It All in the Family?
It’s not just expenses for a spouse or child that are possibly eligible for a claim — other relatives living in your household, such as siblings, nieces or nephews, in-laws, and stepparents or stepsiblings could qualify. In fact, according to the IRS, even non-relatives qualify, provided they lived with you all year and your relationship “did not violate local law.”
Are Medical Alert Devices Tax Deductible?
You probably know that some expenses, such as ambulance services, hearing aids, and blood sugar testing supplies, are tax deductible. You might not know that other expenses, such as acupuncture, home modifications (e.g., widening doorways, or installing handrails or grip bars), vision-correcting contact lenses, and even smoking cessation programs are tax deductible, too. But what about medical alert devices?
While the IRS guidelines do not currently list medical alert devices specifically, they do list medical information plans as a qualifying expense: “You can include in medical expenses amounts paid to a plan that keeps medical information in a computer data bank and retrieves and furnishes the information upon request to an attending physician.” So if your medical alert system can provide your personal medical information to a physician or medical response team in the event of a fall or emergency, there’s a chance that you could claim the expense on your taxes under this exemption. Please remember that tax laws constantly change, so it’s crucial that you always speak with a tax professional to be sure you’re claiming a currently recognized expense.
Talk with your local tax office or financial advisor to find out what you’re qualified for and what you can claim. It’ll help you stay on the right track for a financially successful year.
