Maximizing Tax Deductions for Assisted Living Expenses: A Guide for Seniors and Caregivers As people age, they may require assistance with daily activities. Assisted living facilities provide a range of services, from help with dressing and grooming to medication management and meal preparation. These services can be expensive, but there may be tax deductions available to help offset the costs. What Expenses Are Tax Deductible? The Internal Revenue Service (IRS) allows taxpayers to deduct certain medical expenses, including those related to assisted living, on their tax returns. To qualify for a tax deduction, the expenses must be considered "qualified medical expenses" and exceed 7.5% of the taxpayer's adjusted gross income (AGI). Qualified medical expenses can include: The cost of medical care provided by physicians, nurses, and other medical professionals Prescription medications and medical equipment Long-term care insurance premiums Transportation to and from medical appointments Home modifications to accommodate disabilities Assisted living expenses It is important to note that only the portion of the assisted living expenses that are considered "medical care" can be deducted. This includes the cost of medical services, such as medication management and assistance with activities of daily living, but not room and board or other non-medical expenses.