nikked
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I know many of us have special needs children. Here is some GREAT information regarding tax breaks available to us that you may not have been aware of...I know I wasn't!
I'm just sharing the information I received from a loop I'm on. Please contact a tax professional for more information!
I'm just sharing the information I received from a loop I'm on. Please contact a tax professional for more information!
CPA said:This information is for educational purposes only and is not considered tax advice. Please consult your personal tax advisor.
http://www.tacanow.org/family-resources/tax-strategies-for-parents-of-kids-with-special-needs/
Tax Strategies for Parents of Kids with Special Needs
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July 11th, 2010
Regina M. Levy, CPA
September 7, 2008
Schwab Learning estimates that 15-30 percent of families with a special needs child have one or more unclaimed tax benefits. Are you one of these families???
Medical Expense Deductions
Many parents don’t realize that Learning Disabilities are considered a medical condition, as are other disabilities such as autism, cerebral palsy, ADHD, etc. [Rev. ruling 78-340, 1978-2 C.C. 124]
Medical expenses are limited by 7.5% of Adjusted Gross Income, but some of the following out-of-pocket costs may cause you to exceed that limitation. Costs that can be deducted include:
- Special Schooling including tuition or tutoring by someone especially trained to meet the child’s needs. The purpose and primarily reason for the choice of school must be to alleviate or remediate the disability.
- Regular education when the purpose is to treat the disability and the school – such as typical preschool for socialization purposes.
- Aides required for a child to benefit from regular or special education.
- Special instruction, training or therapy such as OT, Speech, remedial reading, etc.
- Diagnostic evaluations by qualified personnel.
- Exercise program if recommended by qualified medical personnel to treat a specific condition, includes yoga, dance, horseback riding, etc.
- Transportation: Mileage to and from special schools or therapy sessions at the medical mileage rate of 20 cents per mile. Also parking fees. Airfare for parents and child to obtain treatment or testing.
- Diapers – if related to a medical condition, such as autism.
- Equipment or devices used primarily for the alleviation of a person’s illness – examples would be specially designed bedding, car seats, etc. Rev Ruling 76-80.
- Home Improvements – costs are deductible to the extent they exceed any increase in the home’s fair market value [Reg. 1.213-1(e) (1) (iii)]. Certain improvements (e.g., altering the location of or otherwise modifying electrical outlets and fixtures are deemed to have no affect on the home’s fair market value and thus, the full cost can be claimed as a medical expense [Rev. Rul. 87-106, 1987-2 CB 67].
- Lead Paint Removal – The cost of removing the paint can be deductible if the child has lead poisoning from the paint. Lead poisoning can resemble and complicate other conditions, such as autism.
- Parents’ attendance at a disability related conference. This good news came in May 2000, in IRS Revenue Ruling 2000-24. Parents who attend conferences primarily to obtain medical information concerning treatment for and care of their child may include the following admission and transpiration costs. Related books and materials are deductable. Attendance is considered to be primarily for and essential to the care of the dependant if:
- Attendance at the conference has been recommended by a medical provider treating the child. AND
- The conference provides medical information concerning the child’s condition – specific issues not just general wellbeing. AND
- The primary purpose of the visit is to attend the conference.
- BUT … Costs of food and lodging are generally NOT deductible. Lodging can be if you are staying in a hotel while your child receives medical attention in a hospital or related setting. Then lodging is limited to $50 per day. Meals are not deductible.
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