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Paying for Care

Is Home Care Tax Deductible? What Families Should Know

Is home care tax deductible? Learn when in-home care may count as a medical expense, how claiming a parent as a dependent works, and what records to keep.

Home care is an investment in a loved one’s safety and independence, and it’s natural to wonder whether any of that cost can come back at tax time. So, is home care tax deductible? In some situations, it can. The rules are specific, so it’s worth understanding the basics before you talk with a tax professional.

Quick answer: Home care costs may be tax deductible as medical expenses when the person receiving care is “chronically ill” under IRS rules and the care follows a plan prescribed by a licensed health care practitioner. Deductions only help if you itemize, and only the portion of total medical expenses above a percentage of adjusted gross income counts. Always confirm with a tax professional.

Is Home Care Tax Deductible as a Medical Expense?

Under U.S. tax rules, qualified long-term care services can be treated as deductible medical expenses. In general, that requires two things:

  1. The person is chronically ill. This usually means a licensed health care practitioner has certified that the person can’t perform at least two activities of daily living (such as bathing, dressing, eating, toileting, continence, or transferring) without substantial help for at least 90 days, or needs substantial supervision because of a severe cognitive impairment, such as dementia.
  2. The care follows a plan of care. The services must be provided under a plan prescribed by a licensed health care practitioner.

When those conditions are met, the cost of personal care services like help with bathing and dressing may qualify. Purely household services may be treated differently, so keep detailed records of the type of care provided.

The Itemizing Threshold

Medical expenses are only deductible if you itemize deductions instead of taking the standard deduction, and only the amount above a set percentage of your adjusted gross income (AGI) counts. For many recent tax years that threshold has been 7.5% of AGI. Because home care can be a significant expense, some families find they do exceed it. Check the current rules for the tax year you’re filing.

Can I Deduct Care I Pay for My Parent?

Possibly. If you pay for a parent’s care and your parent qualifies as your dependent, or would qualify except for certain income limits, you may be able to include the medical expenses you paid for them on your own return. Dependency rules involve income limits and how much of their support you provide, so this is a good question for a tax advisor.

The Dependent Care Credit

If you pay for care for a dependent adult who can’t care for themselves, so that you can work or look for work, you may qualify for the Child and Dependent Care Credit. The parent generally must live with you for more than half the year. This is a credit, not a deduction, and it has its own rules and limits.

Other Tax-Related Tools

  • Flexible spending accounts: Some employer dependent care FSAs can be used for qualifying adult dependent care.
  • Health savings accounts: HSA funds can generally be used for qualified medical expenses, which may include qualified long-term care services.
  • Long-term care insurance premiums: A portion of premiums may count as a medical expense, depending on age and policy.
  • State tax benefits: Some states offer their own credits or deductions for caregivers.

Records to Keep

Good records make tax time easier and help support your deduction:

  • Invoices and proof of payment for home care services
  • A written plan of care from a licensed health care practitioner
  • Documentation of the chronic illness certification
  • A breakdown of personal care services versus other services, when available
  • Receipts for related expenses like medical equipment and home modifications
Five records to keep for a home care tax deduction: invoices and proof of payment, a written plan of care from a licensed health care practitioner, chronic illness certification, a breakdown of personal care versus other services, and receipts for medical equipment and home modifications.

Fitting Taxes Into Your Bigger Payment Plan

Tax benefits rarely cover the full cost of care, but they can make a real difference alongside other resources. For the complete picture, including long-term care insurance, Medicaid, and veterans’ benefits, see our guide to how to pay for home care. For everyday budgeting, read understanding in-home care costs and budgeting.

Frequently Asked Questions

Is companion care tax deductible?

Companion care on its own usually doesn’t qualify as a medical expense. It may be different when it’s part of a prescribed plan of care for someone who is chronically ill. Ask a tax professional.

Do I need a doctor’s note to deduct home care?

To treat home care as qualified long-term care, you generally need certification of chronic illness and a plan of care from a licensed health care practitioner.

How Briggs Home Care Can Help

Your local Briggs Home Care team can provide invoices and documentation of services to support your recordkeeping. Our local teams can also talk through care options that fit your budget. Find a location near you or call 1-833-960-CARE (2273).

This article is general information, not tax or legal advice. Tax rules change; consult a qualified tax professional about your situation.

Related Reading

Trusted outside resource: IRS Publication 502, Medical and Dental Expenses

Related Resources