Helping Your Clients Deduct Your Services From Their Income Taxes (IRS and CRA)

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Helping Your Clients Deduct Your Services From Their Income Taxes (IRS and CRA)

It’s a good year to revisit patient advocacy services and income taxes. Our first review came in 2010. We looked again in 2013.  While little (maybe nothing) has changed, this year I have a new suggestion for you – a bit of a twist. In question is whether or not your patient advocacy services should be included in the list of medical expenses that allow them to be deducted from your clients’ income taxes;  whether they can be used to reach that 10% or 7.5% threshold that allows them to be deductible (for the IRS).  This is all not-so-clearly spelled out in Publication 502 from the IRS and on this list of eligible medical expenses from the CRA. If your services ARE deductible, that’s a huge WIN-WIN – for you and your client. It makes your services more affordable. But “not-so-clearly” is still a problem in 2015. As mentioned in previous years, patient advocates or navigators or health advocates or coaches – none of these are specifically included in the list of what can be deducted. Many forms of advocacy are covered – but not using any of the terms we use for our work. We just don’t call ourselves the same names as those services that are listed. Until the deductibility of patient advocacy services either shows up on the list all on its own, or is tested during an audit, we can only guess that they will be, some day, a bona fide, deductible expense. But it is most certainly an educated guess. Within the existing list, we have plenty of evidence that the services we provide as advocates are/will be eligible expenses, as follows: This is the type of evidence an accountant could argue during an audit.  For example, from Publication 502 from the IRS*: Christian Science Practitioner expenses can be deducted.  Christian Science practitioners provide “spiritual treatment through prayer that results in healing.”  How patient advocates can use this information for support:  our work is all focused on providing peace of mind to our clients, similar to the peace of mind a Christian Science Practitioner would…


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