Taxpayer (in California), nearing 100 years old, entered an assisted living facility last year after a diagnosis of cognitive impairment and advice from her physician that she could not live by herself any more. The cognitive problems are why she is in assisted living. I believe she qualifies as "chronically ill."
I hope to learn what documentation I need, and what questions I need to ask (of the facility or her physician), to maximize the allowable deduction for her long-term care expenses. Long-term care insurance pays for a portion of the costs (we have a 1099-LTC form) but her costs exceed that by quite a bit..
1. We have a copy of her "Individual Service Plan" prepared last year by the Care Manager of the facility. It notes among other things that that her physician has ordered that "resident may NOT leave the community unattended." The Service Plan describes various ways that she will be monitored during the day. It describes her as "non-ambulatory per California regulations."
2. Her level of care is NOT currently "memory care". It is regular assisted living room/board/housekeeping with additional charges for medication management (she needs help remembering to take prescription medications). Also, some extra monthly charges for processing her LTC insurance forms, and for an emergency pendant.
I have read that one can in certain circumstances justify deducting all costs (in excess of insurance payments and 7.5% of income rule) if one checks certain boxes. Is that likely in my case? One of the criteria is that her care is "Provided pursuant to a plan of care prescribed by a licensed health care provider." Does the plan of care prepared by the Care Manager count? What do I need to ask?
