A little diligence can make a big difference at tax time.
As the parent of a child with autism, I know all too well the high cost of treatments, therapies and co-pays not covered by insurance. My son, Dean, will be turning 16 this year. He was diagnosed at the age of three, so we’ve been at this for quite a while. When I became a tax preparer, I began to better understand tax rules and laws concerning medical expenses. I discovered that many autism-related costs are deductible as medical expenses on a personal income tax return, but are overlooked by many parents.
I’ve spent a lot of time researching common (and not so common) expenses, and feel it’s important to make sure that parents within the autism community are taking full advantage of all the deductions that are available. Every penny counts—especially when you have a special-needs child.
Most of the available deductions are taken as medical expenses on a schedule A, which is then carried to your Form 1040. Medical expenses are limited by 7.5 percent of Adjusted Gross Income, but some of the following out-of-pocket costs may cause you to exceed that limitation.
Medical expenses are defined as “the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and the costs for treatments affecting any part or function of the body.” This includes a multitude of categories, such as equipment, supplies, diagnostic devices, doctor visits, prescriptions, etc. Some of the most common and well-known deductions are prescription co-pays, mileage, insurance premiums (as long as they are not taken from your paycheck as a pre-tax deduction) and over-the-counter expenses (such as saline, bandages and antiseptic for wound care, saline solution, etc.)
Speaking in Specifics
Aside from some of those basic medical expenses, there are many others that are more relevant to families with special needs children, specifically autism. Now, listen up—and take notes!—because this is where it gets interesting for my fellow autism parents.
Any fees you pay (on a doctor’s recommendation) for your child to be tutored by a teacher who has been specially trained to work with children with learning disabilities are deductible. If you’ve made the choice to send your child to a school that specializes in his disability, then you can include the tuition, meals, and lodging expenses as a deduction, as long as the school was recommended by a doctor.
Parents who believe that various toxins may have played a role in their child’s autism often start looking for any environmental problems that may exist in their home, such as mold and mildew, or in older homes, lead from lead paint. There are swabs you can buy at the paint store to test paint simply by swabbing it and seeing if it turns colors. We all want our kids to be in the safest environment possible (see our feature on p35), so if lead paint is detected in your home, keep in mind that all the costs involved for removing it from your home would be deductible expenses.
Have you ever wanted to attend an autism conference but found the cost to be prohibitive? (I recommend the NAA conference personally, because it is so relaxing for moms and an amazing informational conference.) Go! Enjoy! Learn all you can! Because you can deduct the amount paid for admission and transportation to and from the conference (the cost of your meals and lodging aren’t deductible, however). Keep in mind that the IRS has strict rules regarding travel. There can’t be any “significant element of personal pleasure,” so whatever you do, do not have fun (okay, you can have a little fun… just don’t overdo it!). The majority of your time spent at the conference must be spent attending sessions… but that isn’t to say you can’t partake of a glass of wine in the evening while catching up with all your fellow online autism moms and dads.
Supplements are also an important consideration. Many of you are probably like me, in that you have your very own nutritional lab in your kitchen pantry.
Most people see that nutritional supplements are listed under the “not deductible” section, or only read the first part and don’t finish the rule. It states that the cost of nutritional supplements, vitamins, herbal supplements, natural medicines, etc, cannot be included in medical expenses unless (key word here) “they are recommended by a medical practitioner as treatment for specific medical condition diagnosed by a physician.” Voila: they’re deductible.
Organized and efficient record keeping is vital for any tax matters, so keep all of your receipts. If you use the same doctor, pharmacy, dentist, etc., you can usually get an end of the year printout from them for the out-of-pocket totals. I recommend this, as it’s usually the easiest way to access the total amounts spent, and takes up a lot less space.
This would also enable you to have a record of each of the dates you went to appointments, so that you can figure your mileage. I’ve found it useful to use MapQuest or Google maps: their online directions tools include mileage totals. I print these out and put them with my tax records to prove the distances traveled.
Another important end-of- year item to have is from your child’s doctor. Get him or her to write (or you write it and have them sign it) a statement with all the supplements your child has taken through the year, what the diagnosed conditions are, and whether they are on a special diet or need/have a therapy dog. Make sure it’s signed, and then tuck that away with your tax records. If I were ever to get audited, (gasp!) I have all my receipts, mileage statements, and letters from my son’s doctor all in one spot, so that it would be easy and impressive to produce whatever the auditor might want to see.