Under the 1996 Health Insurance Portability and Accountability Act, assisted living expenses may be tax deductible if a few terms are met. If the resident is chronically ill, entitled to itemize their deductions, adheres to a care plan prescribed by a licensed health care practitioner and their expenses exceed 7.5 percent of the senior’s adjusted gross income then assisted living expenses are tax deductible.
Generally, a taxpayer can deduct the medical care expenses of his or her parent if the taxpayer provides more than 50% of the parent’s support costs. For some Assisted Living residents the entire monthly rental fee might be deductible, while for some just the specific personal care services would qualify for a deduction.
