Hiring a caregiver for an aging loved one can be an investment, and for some, a source of financial stress. Fortunately, you can decrease costs by taking advantage of tax deductions for medical expenses. Although the tax code can be confusing, an accountant will be well-versed in these deductions, so ask them whether you qualify. Before you speak with a professional, thought, there are a few things you should know about these deductions and how they work.

A Guide to Caregiver Expenses & Tax Breaks

Who Qualifies for a Deduction?

To deduct your yearly medical expenses, they must reach a certain threshold of your annual income. Recent changes to the tax code have lowered this threshold from 10% to 7.5% for both the 2017 and 2018 tax years. To deduct expenses you’ve paid toward a loved one’s care that have not been reimbursed by insurance, you must be able to claim them as a dependent. This means you must be responsible for more than 50% of their living expenses, and they must not have their own annual income that exceeds $4,050. To claim these deductions, you’ll need to itemize your taxes. Under new law, it may make more sense to take the new, higher standard deduction rather than itemizing.

What Caregiver-Related Expenses Can Be Deducted? 

The law allows for a wide range of treatments, medical devices, drugs, and other supplies to be classified as medical expenses. Some examples are senior home health care, nurse visits, assisted living costs, transportation to treatment centers and doctor’s appointments, physical therapy sessions, glasses, and hearing aids. It’s important to keep all of your receipts and payment agreements so you can show them to your tax preparer. Even the most minor expenses can add up, so don’t be shy about asking your tax professional what qualifies.

If your aging loved one needs assistance with daily tasks and activities, consider in-home help from a caregiver through Deer Valley Home Health Services. With three convenient offices in Berkeley, St. Charles, and St. Louis, MO, your senior family member will retain their independence by living at home while receiving top-quality care from a highly trained staff. To schedule a consultation, call (314) 355-3679 or visit the website to learn more about their services.