It’s time to begin organizing your tax documents, an exercise that can be particularly confusing when a family member has special needs. Here are some suggestions to bear in mind.
When a loved one has special needs, the cost of health care is usually a major concern, so be sure that you claim all the deductions to which you’re entitled. Eligible outlays totaling over 7.5 percent of the taxpayer’s adjusted gross income can be subtracted. They include the unreimbursed cost of medical and dental care, related travel, insurance premiums, certain types of equipment and attendance at conferences on chronic illnesses. Expenses for medically required stays in a long-term care facility should also be included.
In some cases, it may be better to deduct disability-related job expenses ? such as special transportation or adaptive equipment—separately rather than as medical expenses. While these expenses may be subject to a two percent threshold, they won’t be held to the higher 7.5 percent threshold applicable to medical expenses.
Don’t forget that if you’re paying for over half the support of an adult child or frail parent, they can be claimed as dependents, as long as the exemption exceeds their personal income. A higher standard deduction is available for individuals with vision-related disabilities.
Tax planning is clearly a complex matter for families with special needs and regulations may shift from year to year. Obtaining qualified advice can prevent costly mistakes.
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