Deducting support of relative in memory care

[jthompsd]

Greetings,

I am sharing with my wife's brother, support of my wife's mother in a memory care facility. We are contributing more than 50% of her cost for lodging and care at a memory facility, and as well as paying for her prescriptions, with social security and veteran's spousal support covering the balance.

Can one of us deduct either their share or the total of our combined contribution to her care on our taxes (with the other supplying a letter that they will not claim support)?

Thanks.

John

[LeonardS]

Yes,  you can deduct medical costs you pay directly to medical service providers for another person according to the following rules:

• If you pay medical expenses for someone you do not claim as a dependent on your income tax return, you can deduct those expenses if:
  • He or she either lived with you for the entire year as a member of your household.
  • He or she is related to you, see list below
  • Resident of Canada or Mexico, for some part of the year.
  • You provided over half of his or her support for the year

Here's a list of people considered to be relatives by virtue of blood or marriage:

• Children, grandchildren or stepchildren
• Siblings, including half or step-siblings
• Parents, grandparents or any other direct ancestors
• Stepparents
• Aunts or uncles
• Nieces or nephews
• Fathers-in-law, mothers-in-law, sons-in-law, daughters-in-law, brothers-in-law or sisters-in-law

[Opus 17 · Accepted solution]

You can deduct medical expenses you pay for someone you claim as a dependent.  Only one taxpayer can claim mom as a dependent.  If you paid more than 50% of her expenses, that would be you and your wife (assuming you file a joint return).  (If the brother also claimed mom as a dependent, that will cause an IRS intervention.  So best to be united as a family on this first.)

The question then becomes, which expenses are deductible.  Normally, only medical care is deductible, and not lodging, or meals, or assistance with housecleaning or laundry.  If you are in a nursing home primarily to receive medical care, then lodging, meals etc. are also deductible medical expenses.  But most memory care places provide little or no actual medical care because they don't have full nursing home licenses.

However, there was recently a change in the law to put Alzhiemers on parity with other chronic illnesses.  The rules now say:

• Assisted Living residents seeking tax deductions for their services must qualify as “chronically ill”. This definition refers to seniors who are unable to perform two or more “Activities of Daily Living” (eating, transferring, bathing, dressing and continence) without assistance, or who need constant supervision because of a “severe cognitive impairment” such as Alzheimer’s disease or related dementias. The Assisted Living resident must have been certified within the previous 12 months as “chronically ill” by a licensed health care practitioner.
• In order to qualify for a deduction, personal care services must be provided pursuant to a plan of care prescribed by a licensed health care practitioner. Many Assisted Living communities have on staff a licensed nurse or social worker who prepares a plan of care, sometimes called a “Wellness Care Plan,” in coordination with the resident’s physician which outlines the specific daily services the resident will receive in the community.

So you may want to review with the living facility, which expenses they would consider applicable to these rules, and whether mom has a qualified "care plan" or "wellness plan". 

This is what the IRS says.  https://www.irs.gov/faqs/itemized-deductions-standard-deduction/medical-nursing-home-special-care-ex...

This is a really good article I think.

https://www.riverglenhouse.com/is-alzheimers-memory-care-a-tax-deductible-expense/

This I think is also pretty good.

https://www.seniorlivingresidences.com/family-guide/financial-options/tax-deductibility/

[abbrowniii]

what do you put in the box for "number of months she lived with you"?  If I put "zero" number of months, TT won't let me claim her as dependent?

[KrisD15]

HERE is a list of relatives that do not need to live in your home to qualify as your dependent. 

You can select Zero for months in the home. If the person is related in a way listed on the linked article, and they did not earn 5,050 for 2024, the program will list that person as your dependent. 

So in your case, you would select "Parent" on the "What's Your Relationship to this person?" screen

Continue through the interview. 

To be your dependent, you would need to also indicate that no one else supported this person, they did not live with someone else (who supported them) for more than six months, they are unmarried or married but only filing for a refund if filing a joint tax return, 

 and NO to making $5,050 in 2024. (This does not include non-taxable Social Security) 

[Opus 17]

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@abbrowniii wrote:

what do you put in the box for "number of months she lived with you"?  If I put "zero" number of months, TT won't let me claim her as dependent?

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You can only claim medical expenses for a dependent, or for certain relatives who meet most of the qualifications of being a dependent.

For an adult to be your dependent, they must have less than $5050 of taxable income, and you pay more than half their financial support, and they either (a) live with you the entire year, or (b) are related to you in a specific way.  The list of relatives who don't have to live with you are:

• Your child, stepchild, or foster child, or a descendant of any of them (for example, your grandchild). (A legally adopted child is considered your child.)

• Your brother, sister, half brother, half sister, stepbrother, or stepsister.

• Your father, mother, grandparent, or other direct ancestor, but not foster parent.

• Your stepfather or stepmother.

• A son or daughter of your brother or sister.

• A son or daughter of your half brother or half sister.

• A brother or sister of your father or mother.

• Your son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law.

You can claim medical expenses you pay for an adult who is not your dependent if they meet the support test and the residency test, but are disqualified because they have more than $5050 of taxable income.  In other words, you can claim medical expenses for a adult if

(a) you pay more than half their total support, and 

(b) they live with you all year OR are related to you in one of the ways listed above.