12 Oct Your Accessibility Equipment May Count as a Medical Expense
As the year winds down, many households sit down to review their finances and gather receipts for tax season. If you installed a wheelchair lift, ceiling track lift, ramp, or other accessibility equipment this year, or you are thinking about doing so before December 31, it is worth knowing that federal tax rules may allow some of those costs to count as medical expenses.
This article is general information, not tax advice. Your situation is unique, so please review the details with a qualified tax professional before making decisions.
What the IRS says about home accessibility
IRS Publication 502 explains that you may be able to include in medical expenses the cost of special equipment installed in a home when the main purpose is medical care for you, your spouse, or your dependent. The publication lists examples of improvements made to accommodate a person with a disability, including:
- Constructing entrance or exit ramps
- Widening doorways and hallways
- Installing railings, support bars, or other modifications to bathrooms
- Modifying stairways
- Installing porch lifts and other forms of lifts
According to the IRS, improvements like these generally do not increase the value of a home, so the full cost may qualify. The IRS also notes that elevators generally do add value to a house. When an improvement increases your property value, only the portion of the cost that exceeds the increase in value may count, which is why an appraisal can be helpful for larger projects. Ongoing costs to operate and maintain qualifying equipment may also be included.
Itemizing and the 7.5 percent threshold
There are two important conditions to keep in mind. First, the medical expense deduction is only available if you itemize deductions rather than take the standard deduction. Second, you can generally deduct only the amount of total qualifying medical expenses that exceeds 7.5 percent of your adjusted gross income. For some households, a larger accessibility project in the same year as other medical costs may make itemizing worthwhile. For others, the standard deduction may still come out ahead. A tax professional can help you run the numbers.
What about HSAs and FSAs?
Health savings accounts and flexible spending accounts can generally be used for qualified medical expenses, as described in IRS Publication 969. Whether a specific piece of equipment qualifies can depend on your plan and your circumstances, and some plan administrators ask for a letter of medical necessity from a physician. Check with your plan administrator before you buy if you hope to use these funds.
Timing matters at year end
Medical expenses generally count in the year you pay them. If you are weighing whether to complete a project in December or wait until January, that timing may affect which tax year the expense falls in. Talk with your tax advisor about which approach makes more sense for you.
Keep good records
Save your estimate, invoice, proof of payment, and any written recommendation from a physician or therapist. For larger projects such as a home elevator, keep any appraisal or documentation of how the improvement affected your home’s value. Organized records make tax time easier and help your advisor give you accurate guidance.
When you request an estimate from Lift-Aids, Inc., our team provides a detailed estimate for your project that you can share with your tax professional. Keep medical documentation, such as a physician’s recommendation, with your own records and share it only with the professionals who need it. If you are exploring other ways to pay for equipment, our article Are There Grants or Financial Assistance Programs for Home Accessibility Equipment? is a helpful next read.
Plan your accessibility project with confidence
If you are considering a wheelchair platform lift, ceiling track lift, or home elevator, our team can assess your home and provide a detailed written estimate to share with your tax professional. Schedule your estimate with Lift-Aids, Inc. and get clear answers before the year ends.
Request your estimate with Lift-Aids, Inc. today
Sources: IRS Publication 502, Medical and Dental Expenses, IRS Publication 969, Health Savings Accounts and Other Tax Favored Health Plans, IRS Tax Topic 502, Medical and Dental Expenses
Disclaimer: This content is for general informational purposes only and does not constitute safety, engineering, or regulatory advice. Equipment selection and outcomes vary based on application, environment, and usage.