Can i deduct nursing home costs

Nursing homes or long-term care facilities are more affordable because they are government funded and regulated. Retirement homes in Ontario are private and not typically subsidized by the government. You may find yourself in one of the following three scenarios when considering what can be claimed:. You can obtain a Disability Tax Credit Certificate DTC Certificate by filing the T form completed from a medical practitioner, certifying that you have a severe and prolonged impairment in physical or mental function.

Some medical conditions may not meet the stringent conditions to be eligible for the DTC Certificate. In those situations, you should obtain a letter from a qualified medical practitioner, certifying that due to a physical or mental infirmity you are for the near future and will continue to be in need of a full-time attendant or care in a facility. Without them, you are unable to claim expenses paid to a nursing home or long-term care facility. There is an exception for retirement home residents who live on a critical care floor in that CRA treats those taxpayers the same as those in a nursing home for tax purposes.

Claiming medical expenses can be confusing, especially considering the sizeable nature of the amounts. CRA also audits medical expense claims often, sometimes numerous years in a row where the amounts claimed are large enough. You may claim Income Tax IT relief on nursing home expenses paid by you. You can claim this relief as a deduction from your total income if the nursing home provides hour on-site nursing care.

This means that the portion of your income which is taxable at your highest rate of tax is reduced. For detailed examples on how relief for nursing home expenses is calculated please see section 5 of the Health Expenses Tax and Duty Manual. You cannot claim tax relief on the amount paid by the HSE. You can only claim tax relief on the amount you pay yourself. You may wish to defer your healthcare costs. You can do this if you have Irish land or property assets. The HSE provide you with a loan, using your assets as security.

The loan is paid directly by the HSE to the nursing home. You cannot claim tax relief on the amount paid by the HSE to the nursing home. In certain circumstances, Revenue can grant you relief on nursing home expenses during the tax year.

To request this, contact your Revenue Office with details of your claim. If you do receive tax relief during the year, you must complete your claim details after the year ends, as normal. You can claim relief for the cost of expenses of additional nursing care. You or your relative may:. You must also provide the nurse's full name and address, as well as proof of their nursing qualification. The entire costs paid including meals and lodging to a nursing home, home for the aged, or similar institution, are fully deductible as a medical expense if the person is staying at the home primarily for medical care.

However, if an individual is in the home primarily for non-medical reasons, then only the portion attributable to actual medical or nursing care, excluding meals and lodging, is deductible.

Premiums paid for a qualified long-term care insurance contract are deductible as medical expenses subject to an annual premium deduction limitation based on age, as explained below to the extent they, along with other medical expenses, exceed 7. For the tax years and , qualified long-term care premiums are includible as medical expenses up to the following dollar amounts per individual:. If your parent qualifies as your dependent, you can include any medical expenses you incur for your parent along with your own when determining your medical deduction.

You may be able to claim your parent as a dependent, thus qualifying for an exemption, even though your parent is confined to a nursing home. The qualifying factors for claiming a parent as a dependent are:.

It is also important to note that gross income does not include Social Security payments, in most cases. If the support test a above can only be met by a group you and your brothers and sisters, for example, combining to support your parent , a multiple support form can be filed to grant one of you the exemption, subject to certain conditions.

In order to qualify for head-of-household status, generally you must have paid more than half the cost of maintaining a home for yourself and a qualifying relative for more than half the year. In the case of a parent, however, you may be eligible to file as head of household if you pay more than half the cost of maintaining a home that was the principal home for your parent for the entire year. Thus, if your parent is confined to a nursing home, you are considered to be maintaining a principal home for your parent if you pay more than half the cost of keeping your parent in the nursing home.

As the average age in America continues to climb, the need for medical care for the elderly continues to increase. With the increasing costs of medical care, it is important to understand the IRS rules for deducting these costs on your personal tax return.