disabled expenses deductible as medical

[ljwalters]

Are Fiduciary services deductible.

Client has severe demetia and courts ordered a fiduciary to take over his health and financial affairs.

Are these deductible as medical. I know personal services for the blind are.

[michaelmars]

I always took guardianships as other subject to 2% for court appointed guardians, if that helps

[kcjenkins]

Yes.

[ljwalters]

Thanks KC, Now if I could just get her to tell me her charge for the year. She is keeping that quite a secret.

off hand, Do you know of a site I quote her. This return will go on extension so I can find a quote and get the info.

[jainen]

>>courts ordered a fiduciary to take over his health and financial affairs<<

I don't see how paying someone to handle financial affairs is a medical expense in the same way personal care would be. If you can get an ITEMIZED bill, as required for legal expenses, some costs might be allocated to medical decisions and some might be investment decisions for taxable income.

[ljwalters]

Thi is not legal expenses. It is a person to protect your money from family members who were abusing power of atorney because you were declared incompitent to handl your own affairs in cluding doctor visit paying bills and hiring some one to feed you. All Medical. Not because he is out of the country or in jail (just a couple of reasons some one hires a personal bookkeeper) but rather becase he is ILL. There fore Legal doesn't work.

[jainen]

>>because he is ILL<<

The question is not WHY he needs the expense, but WHAT the expense is. For example, in TC Summary Opinion 2004-74 a disabled taxpayer had transportation expense because he couldn't drive himself. The court said it was not deductible because the transportation was not for the treatment of a medical condition.

In the original post, protecting assets is important but doesn't do anything for the disability itself. My comparison to legal expenses was only to suggest a way of allocating the bill for costs if some do treat a medical condition.

[ari]

if hire a caretaker, consider that need to put on payroll and work compensation and disability insurance if applicable

[jklcpa]

From pub 502 Legal Fees

You can include in medical expenses legal fees you paid that are necessary to authorize treatment for mental illness. However, you cannot include in medical expenses fees for the management of a guardianship estate, fees for conducting the affairs of the person being treated, or other fees that are not necessary for medical care.

The above is in the legal section, but it does say that fees paid for conducting the patient's affairs... are not deductible.

I wouldn't deduct the expense.

[kcjenkins]

I stand corrected. I think Judy has it right, and while some of the cost may be " to authorize treatment for mental illness", only that portion would be medical.. The rest would be "for protection of income and assets", thus deductible but subject to the 2% haircut.

[michaelmars]

I'D rather have the 2% haircut than the 7.5 going to 10% med h/c

[jainen]

>>courts ordered a fiduciary to take over his health and financial affairs.<<

"Financial affairs" are only deductible for the production of taxable income. Personal matters like housing and transportation would generally not be covered. So again I think the costs need to be allocated. By the way, I assume we are talking about Form 1041--none of this would go on the individual return.