It is very likely that a significant portion — or even all — of her assisted living costs can be deducted as a medical expense, but there are specific IRS “hoops” you must jump through first.
Because the IRS views “rent” (room and board) differently than “medical care,” here is how you can determine if your mother’s expenses qualify for the 2025 tax year.
1. The “Chronically Ill” Requirement
For assisted living rent to be deductible, a health care practitioner (like a doctor or nurse) must certify that the resident is chronically ill. Under IRS rules, this means the person meets one of two criteria:
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Cognitive Impairment: They require substantial supervision to protect themselves from threats to health and safety due to severe cognitive impairment (like Alzheimer’s).
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Activities of Daily Living (ADLs): They are unable to perform at least two ADLs (eating, toileting, transferring, bathing, dressing, or continence) without substantial assistance for at least 90 days.
Since your mom was hospitalized because she could not manage her medication or eat properly due to Alzheimer’s, she likely meets the cognitive impairment criteria easily.
2. The Plan of Care
To deduct the room and board (rent) portion of the bill, the services must be provided according to a written plan of care prescribed by a licensed health care practitioner.
Most assisted living facilities create these plans automatically upon admission. Ensure that your mother’s plan specifically states that she needs the protective environment of assisted living because of her Alzheimer’s.
3. What Exactly Is Deductible?
If your mother meets the “chronically ill” status and has a plan of care, the rules break down like this:
|
Expense Type |
Is it Deductible? |
Condition |
|---|---|---|
|
Medical/Care Services |
Yes |
Costs for nursing, medication management, and help with ADLs. |
|
Room and Board (Rent) |
Yes |
Only if the primary reason for being there is for medical/care services due to being chronically ill. |
|
Entrance Fees |
Partial |
Some facilities allow a one-time deduction for the portion of the buy-in fee that covers future medical care. |
4. The 7.5 Percent Threshold
Remember that medical expenses are only deductible if you itemize your deductions on Schedule A (Form 1040).
You can only deduct the amount of total medical expenses that exceeds 7.5 percent of her Adjusted Gross Income (AGI). For example, if her AGI is $50,000, the first $3,750 of medical expenses aren't deductible. Everything after that $3,750 — including the assisted living rent — is fair game.
Summary Checklist for Your Taxes
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Get a Doctor’s Letter: Ask her primary physician to provide a written statement or “certification” that she is chronically ill due to Alzheimer’s. This must be done within the last 12 months for the deduction to be valid for the 2025 tax year.
-
Request the Care Plan: Get a copy of the care plan from the assisted living facility.
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Itemize Statements: Even if the bill says “Rent,” keep the itemized statements showing the care services provided.
Consult a Professional: Tax laws regarding “dual-purpose” facilities (places that provide both housing and care) can be tricky. A certified public accountant or tax preparer familiar with elder care is highly recommended.
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