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Patient Advocates, Income Tax Deductions and Guide Dogs
Yes – it’s early in the tax season in the United States. Some of us have probably already filed our income taxes. Some have piled up those 1099s and W-2s and are mustering up the courage to make an appointment with our tax preparers. And others are saying, “Please don’t remind me!” But let’s not forget – it’s tax season for our clients, too, many of whom have accumulated enough medical expenses that they may be asking whether or not they can deduct your health or patient advocacy, navigation or medical billing review services from their taxes. Good question, right? Have you ever thought of yourself as someone else’s tax deduction? (Well – OK – your parents took deductions for you, but….) That’s what we need to know…. are patient or health advocates’ or navigators’ services deductible from income taxes? The answer is – maybe, and maybe not. For 2011 taxes (filed in 2012) there is no real answer, but there are definite possibilities. We first asked this question in November 2010 – and at that time I spent a few hours (seriously!) on the phone with an IRS agent to uncover the best answer to this question. And his best answer was just what I said above: there is no answer – yet. The IRS produces a publication which outlines medical deductions, called Publication 502. There is a specific list of medical expenses that are deductible, and there are call-outs of expenses that are not deductible. Patient or health advocacy is missing on both lists. That said, there is a definition of medical expenses, as follows: Medical expenses are the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and the costs for treatments affecting any part or function of the body. These expenses include payments for legal medical services rendered by physicians, surgeons, dentists, and other medical practitioners. They include the costs of equipment, supplies, and diagnostic devices needed for these purposes. Medical care expenses must be primarily to alleviate or prevent a physical or mental defect or illness. They do not include expenses that are merely…