Assisted Living Center

[joans]

I have a TP that lives in an Assisted Living Community. Is the monthly payments deductible on Schedule A. I would say yes, because there are medical professions there to care for them in case of an emergency. However, would it only be able to deduct a percentage like for Lodging for Medical purposes of $50 per day? Any help would be much appreciated. The TP is over 90 and just moved there in 2008. Thanks

Sara

[TAXBILLY]

There are different kinds of assisted living:

1) Is it an apartment where she can do her own cooking, etc and meals are served in the dining room (usually twice a day) and medical staff is available 24 hours a day?

2) Is it akin to a nursing home where one fee per month includes all the basic needs which consist of meals, everyday activities such as bathing, etc and nursing care available 24 hours a day?

1) would not be deductible

2) would be deductible

taxbilly

[joans]

Thanks Taxbilly - I will check with the clients guardian. What you said makes sense. I have tried to look on the IRS website under pub 520 and there is nothing definite.

Sara

[Lion EA]

Is she there because she cannot handle her daily activities without help?

[joans]

I am not real sure. I will have to call his daughter(guardian) to get more information. My biggest problem sometimes is that my boss does all the interviewing and I prepare the returns so I don't always get the full story on the situation:( Sometimes, makes job more difficult, especially when boss doesn't write things down or is fuzzy on details.

[TAXBILLY]

If it's situation 1) there may be a deduction for a nurse or someone not necessarily a nurse that comes in to help her with dressing, washing or eating.

taxbilly

[Maribeth]

There are basically 3 different levels of living in a retirement community. If your client lives in her own apartment, has access to a dining hall, yet takes care of her own daily personal needs, a small portion of the rent she pays to the facility is considered a medical expense and can be deductible. The medical expense is because of the availability of the nursing staff if your client has a medical problem.

If your client is in an assisted living program, where she can be living in her own apartment, has access to a dining hall, yet she cannot take care of her own daily personal needs, then all of the rent she pays to the facility is considered a medical expense and can be deductible. There is a 3 out of 5 test for whether your client can take care of her personal needs such as can she bath herself, can she dress herself, can she be responsible for her meds.

The 3rd level is at the nursing home level, and of course, those expenses are all deductible.

The facility itself should be providing an annual letter to your client advising your client what portion of her monthly rent is deductible.

Maribeth

[TAXBILLY]

Accurately and succintly put, Maribeth.

taxbilly

[Maribeth]

Thank you, Taxbilly.

[michaelmars]

MOST centers have a tax letter, or ruling or guideline available, the % or deduction depends on how many care activities the person needs, ie just cooking, cooking and bathing, or full care, etc. the easiest thing is to call the center or check their website and you will have the info in minutes.

[joans]

Thanks for all the guidance. I really appreciate the help I get on this board:) It makes frustrating times not so bad. I will call the center today and see what I can find out. Thanks again everyone and have a great week!

Sara