Special needs trust for adult daughter

Forum|Forum|2 years ago
October 25, 2023
1 reply
22 views

1. In 2021, I paid a special needs attorney $5,000 to create a special needs trust for my adult daughter diagnosed with schizophrenia. Can I deduct the $5,000 in my 2023 tax filing and if so, where in the turbo tax document?

2. All the costs of psychiatrist and mental health therapists I paid for out of pocket for my daughter, can I deduct in my taxes? If so, where? I've been recording them under medical expense

3. I'm paying the rent for my adult daughter with mental illness. Is the rent I've been paying deductible in my taxes? If so, where

Ask the Experts - Extension - Sept 2023

Scooter1768

Level 2

Hello Maycw80,

Thank you for your questions.

1.) Generally, expenses need to be deducted in the year they are paid, thus it is unlikely you would be able to deduct any legal fees from a previous year in 2023. I also recommend that you also consult your attorney regarding the specifics of any trust issues.

2.) In order to claim your adult daughter's medical expenses on your return, you will need claim her as your dependent on your tax return. If your daughter is older than 23, she will have to be considered permanently disabled and cannot be providing more than half of her own income for her living expenses. Her medical expenses would then be deductible medical expenses on your return as your dependent.

3.) Unfortunately, her rent is not a deductible expense but is a living expense you are providing for her.