Navigating Tax Deductions for Assisted Living Costs - Hurley Elder Care Law | Georgia's #1 Certified Elder Law Attorney

Navigating Tax Deductions for Assisted Living Costs
March 12, 2024
POSTED IN: General Info TAGS: Caregiving, Finances, Long-Term Care Facilities
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As tax season approaches, caregivers of loved ones residing in assisted living facilities often find themselves grappling with questions about deductibility.The IRS does indeed provide guidelines for deducting certain qualified long-term care costs as medical expenses.However, when it comes to the status of Assisted Living Facility (ALF) costs, clarity has been somewhat lacking.

What do caregivers navigating tax deductions for assisted living costs need to know?Navigating tax deductions for assisted living costsFor residents of ALFs, qualified long-term care costs encompass necessary rehabilitative services, maintenance, or personal care services that are essential for chronically ill individuals and provided according to a designated plan of care by a licensed healthcare practitioner.But what exactly does this entail, and how can caregivers determine if their loved ones qualify for tax deductions?Chronically ill individual criteriaTo be eligible for tax deductions for assisted living costs, the resident must qualify as a chronically ill individual.This designation can be met if, within the past 12 months, a licensed healthcare practitioner certifies that the resident meets certain criteria:Activities of Daily Living (ADLs): The resident must be unable to perform at least two ADLs without substantial assistance for a minimum of 90 days due to a loss of functional capacity.

ADLs include essential tasks such as eating, toileting, transferring, bathing, and dressing.Cognitive Impairment: Alternatively, the resident may require substantial supervision to be protected from threats to health and safety due to severe cognitive impairment.Once the chronic illness requirement is satisfied, any assistance provided by the ALF that aids with ADLs or protects the resident from safety and health threats due to cognitive impairments qualifies as personal care services.Who can certify?The certification of chronic illness must be conducted within the preceding 12 months by a licensed care practitioner, such as a physician, registered nurse, or licensed social worker.This practitioner does not necessarily need to be an employee of the ALF, although they could be.Its crucial that the practitioner personally examines the resident and provides a written opinion, ideally obtained prior to admission to the ALF.While federal statutes mandate written care plans for nursing facilities, they are not required for ALFs, although many do prepare them.

However, the plan of care, when prepared, must be done so by a licensed care practitioner and as soon after admission to the ALF as possible.If all requirements are metThen 100% of the ALF costs, including room and board, are deductible on the residents 1040, Schedule A, provided that they are not reimbursed by government benefits or insurance.For 2023 taxes, the resident can claim an itemized deduction for unreimbursed medical expenses to the extent that such expenses exceed 7.5% of adjusted gross income.When requirements are not metIn cases where the resident does not meet the IRS requirements for tax deductions for assisted living costs, they may still deduct the portion of ALF costs attributed to nursing services.Room and board and personal services costs would not be deductible in this scenario.

Typically, 30% to 40% of ALF costs are attributed to nursing services.Hurley Elder Care Law suggests you speak with your tax preparer to discuss these deductions.Please call us at 404-843-0121 with your elder law questions.We offer four convenient locations in Atlanta, Duluth, Peachtee City and Woodstock.

Virtual meetings are also available.
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Posted in General InfoTags: Caregiving, Finances, Long-Term Care Facilities

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Client TestimonialsDue to aging, escalating health and cost concerns for both my husband and myself, I chose to work with Hurley Elder Care to do care and estate planning.I am so very pleased with the result.

I have a much improved understanding of the complexity of this process, the necessary documents, timing, regulations and the need for professional guidance.Gina M.All I can say is Wow ! I have never seen a team attack and solve a problem like Hurley.We lost our father and two weeks later our mother suffered a severe stroke.Nursing home costs were draining their life savings, but Hurley found a solution and got things under control.Gary G.It's impossible to accurately describe the lost feeling of realizing you need power of attorney, updated will and general guidance all of a sudden when dealing with a parent with dementia.

The firms responsiveness has been superb, their work flawless and their advice kind, compassionate and professional.I'll forever know that their guidance prevented us from making many bad decisions.Neal R.Very comfortable atmosphere.They treat you like you are one of the family.Val B.Hurley Elder Care Law went to work for my Mother and navigated all of the Government red tape and got her approved for Medicaid in short order.

I, as her POA, could not even begin to climb the mountain of paperwork on my own.David Q.Superb service through a difficult maze of governmental regulations and requirements which are not navigable by an individual without a depth of knowledge that far exceeds mine.Wallace M.
Working with Jennifer and her team at Hurley was a great experience.Communication is excellent and they were very professional and efficient throughout the entire process.Highly recommend them!read moreread less Harris Wattles 3/08/2024 Wish I could give 10 stars.

We left the meeting knowing we had received excellent advice.Advice was very clear and easy for my mother to understand.We feel so lucky to have found Hurley Elder Care Law.read moreread less Tammy Davis 2/04/2024 I went to Hurley to get help for my wife.

Everyone involved in the process has been informative, attentive, and compassionate.Hurley is definitely the place to go when you need help!read moreread less D Gooden 2/04/2024 I retained Hurley ECL in May of 2023 to work on behalf of my recently widowed mother.I cannot offer high enough praise for this outstanding firm.

Their team approach is a model of efficiency, and efficacy.The level of care they provide the client is unsurpassed in my experience.We were blessed to have been referred to them.read moreread less Louis Mura 12/23/2023 The entire staff was excellent to deal with.

Courteous, professional, and knowledgeable service, they were always prompt in answering questions and being able to direct me through the process of selling my parents home.I would not hesitate to recommend them for all of your elder care legal services.read moreread less James & Susie Wynn 12/09/2023 The team at Hurley Elder Care Law (Kaila Crowder, Nicole Lott & Paul Abrahamson) were very attentive and supportive.They guided me through every step of the process to help my dad.

Any steps I needed to take were extremely clear and easy to execute.They did exactly what they said they would do from beginning to end.They provided regular status updates and phone calls to check on our well-being.

I would highly recommend Hurley Elder Care for your elder family members needs.read moreread less Nick Brown 12/07/2023 I have been so pleased with Hurley EC Law's skilled and knowledgeable service.Kaila, from the beginning, has patiently assisted me in my "learning curve" as executor in the probate/estate phase.Hurley's professional staff are available for calls and thru email, to address and answer every question I've needed during this unfamilar process.

And Kiersten, who was assigned to assist me for my final phase, has been on point from the introduction.She was completely informed on my file, which assured me that she'd put in the work to know where we were in the process when she stepped in.Kiersten is a very professional and personable Blessing to me who constantly keeps me updated on changes and what I need to do to keep on task the "Hurley way".

She consistently follows thru on getting out the appropriate documents and notifications needed in getting every task done.Many thanks to Kiersten.I finally do see the light at the end of this very long tunnel.

I would highly recommend Hurley ECL to family and friends.read moreread less Bj Harris 12/07/2023 Exceptional High Quality Customer Service has been given from the Law Firm ( especially from Andrew and Nicole.)read moreread less Sandra Walker 11/13/2023 We are a very close-knit and spiritual family, and we love and cherish the opportunity of taking care of our family.It was very painful when we learned that one of our dear and senior siblings had developed a severe case of dementia.And this family member was being cared for by an older sibling, which cannot be sustained.

To this end we searched and found Hurley Elder Care Law, who is very experienced in this area of assisting families with finding senior care in this area.Hurley Elder Care Law assisted us in finding a facility which specializes in senior living and rehabilitation care.Additionally, Hurley Elder Care Law has assisted us in getting this family member qualified under Medicaid and they were very professional throughout the entire time and process.

We would highly recommend them to others seeking similar needs and care.read moreread less MATTHEW NORTHCUTT 11/13/2023 I hired Hurley Law because my research showed that they were the most trusted elder law group in Atlanta.Danielle did not disappoint; she was compassionate, hard working, and ultimately won the dispute on my behalf.Great work, Danielle!read moreread less Tony Nettleman 9/19/2023 The team at Hurley are amazing.

I was frankly astonished at the results they were able to provide for my elderly mom.I wholeheartedly recommend Hurley Elder Care Law!read moreread less Sid Stephens 8/07/2023 My family is so thankful we found our way to Hurley Elder Care.We initially met with them just to discuss updating my parents legal documents.

Mom has dementia and she still held my dads health care power of attorney.Miles Hurley is a wealth of knowledge and opened our eyes to ways to protect my parents assets as well as getting mom approved for Medicaid so in home services can be provided to assist my parents.We worked closely with Paul to provide all the needed documents.

His knowledge and patience were appreciated every step of the way.Nicole was also a wealth of information and always available to answer questions and assist us.There is no way we could have navigated this process without Paul and Nicole!read moreread less Cathy R.

8/01/2023 I chose Hurley Elder Care based on all the positive customer reviews and I am so glad I chose them.They are experts in their field and made the Medicaid process stress-free.Prior to partnering with Hurley Elder Care I wasn't getting much sleep due to all the unknown.

Kaila Crowder and Nicole Lott were amazing! They were there every step of the way and now my grandma is on Medicaid! I highly recommend Hurley Elder Care! Also, if I were to look back at the top decisions I have made in my lifetime, partnering with Hurley Elder Care would make that list!!!read moreread less Brian Railey 7/17/2023 I make confident referrals to this law firm with great frequency.They know their industry and provide excellent service.Ive personally been to one of the training seminars that Miles led and gained a great deal of understanding of stage of life preparedness.

Excellent law firm!read moreread less Rand Eberhard 7/05/2023 This is the 2nd time I have used Hurley Elder Care Law firm.They are a very professional group.You get a free one hour meeting to discuss your needs, and then decide whether or not they can help you.

They are expensive, but very efficient.THEY KNOW WHAT THEY ARE DOING!! Because of their expertise and no nonsense approach, we more than covered their fees in what we saved by securing the benefits we sought in very short order.I would definitely use them again and highly recommend their services.

The best! Worth every penny!read moreread less Connie Washburn 2/07/2023 Engaging Hurley Elder Care Law was the best thing I did when undertaking responsibility for the care of my sister with dementia.The staff there is amazing and guided me through the complexities of selecting a nursing home and the daily issues surrounding care.They intervened when necessary to ensure her proper care.

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