Steve Pope wrote:
[snip]
- quote -

of how much of the monthly charge represented medical care.

As to your direct question: I don't know what the IRS would find
acceptable in an audit. What I do know, is that the burden is on
the resident or the resident's representative to show that they
were under a doctor's care, that there was a plan of care and
that the ALF provided that care.

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In article <gk5l88$ir6$1[at]news.motzarella.org> ,
Gene E. Utterback, EA, RFC, ABA <gene[at]alliancetax.com> wrote:
- quote -


OP leads me to believe that she is a "chronically ill individual"
(see definition in IRS Pub 502); and also is likely to have
"Severe Cognitive Impairment", either of which would qualify
100% if her costs including room and board as deductible medical.
--


ArtKamlet at a o l dot c o m Columbus OH K2PZH

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Alan <sfcnm-mtm[at]yahoo.com> wrote:

- quote -

If there is no breakdown, will the IRS accept an estimate,
based on some reasonable method (like comparables?)

Steve

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les wrote:
- quote -

California. Having a tax background, I was asked this question
numerous times, usually by a child of the elder resident.

There are generally three types of living facilities for the
elderly. Independent living, assisted living (ALF) and skilled
nursing facilities (SNF, pronounced sniff). Skilled nursing
facilities are almost always medical facilities and residents are
there primarily for medical care either because they are
chronically ill (unable to perform at least two activities of
daily living (ADLs) without substantial assistance from another
individual for at least 90 days due to a loss of functional
capacity), or they require substantial supervision to be
protected from threats to health and safety due to severe
cognitive impairment or they are recuperating and/or receiving
rehab for a recent illness or surgery. Therefore, I can say
without almost any equivocation, that all expenses incurred in a
SNF are deductible as long as the Is are dotted and the Ts
crossed. Namely, there is physician certification and a written
plan of care.

It is the ALF that almost always presents the problem. That's
because they all don't charge and bill the same way and it is not
always clear as to what is the primary purpose for residing at
the ALF. In addition, ALFs tend to be reluctant to give up the
revenue when a resident has to move to a SNF. Many of them will
try almost anything to keep the resident. Many of them provide
various levels of additional care and services that allow them to
keep the resident. In most cases this is within the licensing
laws of the state. In some cases I and other volunteers would
find the facility in violation because it became obvious that the
resident required either substantial supervision to protect
themselves or other residents or was so chronically ill that a
24/7 medical facility was required.

The law allows for medical deductions when one is resident in an
ALF and the primary reason for being there is medical care (hard
to prove because ALFs are not medical facilities) or the resident
is receiving nursing services or long-term care services
certified by a physician and a written plan of care exists.
Nursing services are deductible. If the person meets the
definition of being chronically ill (see Pub 502 for definition)
or requires substantial supervision, etc. etc, then the whole
cost of the ALF would be deductible. What one often finds is that
the resident is paying for the nursing and or medical services by
contracting for tiered levels of care over and above the monthly
rent. It is the cost of the tiered services that then becomes
deductible. In certain circumstances, the ALF does not provide
identifiable tiered services. They may provide multiple
offerings. Each offering includes the rent and some level of
service. In this case, it is the ALF that has to break out how
much of the cost is a deductible medical expense. Note, if the
resident falls into the long-term care services criteria, then
you must have physician certification and a written plan of care.

As an Ombudsman, one of things we always looked for in SNFs was
the written plan of care. It was a legal requirement for SNFs. It
is not a legal requirement for ALFs as they are not medical
facilities. You need a written plan of care to meet the
deductible medical expense test for long-term care services.

Hope this helps you.

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"les" <lester12345[at]gmail.com> wrote in message
news:9d898f8f-e0ce-4e16-9a1d-17c040d21e79[at]s9g2000prm.googlegroups.com...
- quote -

The facility should be able to give you a breakdown for medically necessary
expenses versus general living expenses. I'd start with them. Keep up
posted and maybe we can help futher.

Good luck,
Gene E. Utterback, EA, RFC, ABA

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"les" wrote:

- quote -

The guidelines are in IRS Publication 502. With the proper documentation
it's likely that all her expenses other than amenities, e.g., hairdressing,
cable, etc., will qualify as deductible medical expenses.

--
Phil Marti
Clarksburg, MD

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My 92 yr old mom lives in an assisted living facility where the
monthly rent is $3800. She is in a studio apartment and has all meals
prepared for her. She has bad dementia and is not able to function on
her own. She needs help dressing, showering, taking medications,
physical therapy, and going to the doctor.

Medical expenses over 7.5% of AGI are tax deductible. Are there any
guidelines as to how much of the $3800 per month I can consider
medical expenses? The facility advises me to check with my
accountant. I keep all the monthly statements. An accountant friend
tells me there are no guidelines, which I find hard to believe.

Any suggestions?

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