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Medical Expense for Allergies

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    #16
    Medical expenses: Doctor recommendation-allergies

    1. Accepting the logic of many who have posted Swifters(r) might be deductible if the doctor "recommends" the TP keep her/his dwelling clearner. Or perhaps those who have food allergies may be able to deduct all their food expense for items to which they are not allergic: thus, a shell-fish allergic taxpayer could eat all the hamburgers they want in lieu of lobster and deduct the hamburger food costs.
    2. However, Ilija, TC Memo 2000-144, Code Section 213 and regulations thereunder, make it clear to me that the proposed deductions would not be sustained on audit and may subject the taxpayer to negligence and/or other penalties.
    3. The doctor's written recommendation is just that: it does not deal with treating the condition or disease any more than a physican for anyone of us recommending we get more rest between Jan 30 and April 15 allows us to deduct the costs of our bedrooms and furniture (of course we depreciated the cot in the back room already). It does suggest a change in life style, or perhaps housekeeping. What the doctor is really recommending is that the taxpayer keep her/his home cleaner. Particulary for taxpayer who want to deduct the costs of removing carpeting and such while shopping at stores with carpeted floors. I wonder if her doctor's office has a cpareting waiting area or other areas? (I doubt it). Hopefully the preparer's office is not carpeted or he sees the taxpayer in an hermatically sealed clean room or area.
    4. To this observer of this dialogue, Rev Rul 76-80 and 55-261 should be read in their entirety.
    5. Finally, while RTFM may resolve 99% of our questions, when it doubt if you have take more than 30 seconds to seemingly conclude an item is deductible, it probably isnt. But then, I am not signing the tax return(s) in question. I don't like 20% negligence penalties, or even the thought of preparer penalties.
    Friends double; family triple. Don't buy an audit for yourself. If someone has to go to jail make sure it is the client. Remember it is only taxes, nothing important.

    Comment


      #17
      I disagree

      Originally posted by mastertaxguy View Post
      2. However, Ilija, TC Memo 2000-144, Code Section 213 and regulations thereunder, make it clear to me that the proposed deductions would not be sustained on audit and may subject the taxpayer to negligence and/or other penalties.
      Not so fast.

      The court did not reject the claimed medical expense because removal of carpeting on a doctor’s recommendation does not qualify as a medical expense deduction. The court rejected the claimed medical expense deduction because the taxpayer could not prove the claimed expenses were specifically associated with the doctor’s recommendations.

      The following are excerpts from the court case the reveal why it rejected the claimed expenses:

      • “We consider first the rental expense incurred by petitioners while the carpeting was removed from, and the hardwood flooring was installed in, petitioners’ residence and the interior of that residence was repainted. On the record before us, we find that Mr. Mitic has failed to show that Dr. Wolfe approved and recommended that rental expense and that it qualifies as an expense paid for medical care under section 213.”

      • “We turn now to the remaining expenditures in question consisting of the amounts paid by petitioners to have the carpeting removed and hardwood flooring installed throughout their residence and the interior of that residence repainted. On the instant record, we reject Mr. Mitic’s contentions that all of those expenditures “were approved and recommended” by Dr. Wolfe as expenditures from which Ms. Mitic “would benefit medically” and were “medically related” to Ms. Mitic’s asthmatic condition.

      To support his contention regarding Dr. Wolfe, Mr. Mitic apparently relies on the June 27, 1980 letter from Dr. Wolfe. We find Mr. Mitic’s reliance on that letter to be misplaced. The June 27, 1980 letter was prepared over 13 years before the expenditures in question were incurred. We find that letter to have very little, if any, probative value regarding why petitioners decided to remove carpeting from, and install hardwood flooring in, their residence and have that residence repainted.”

      • “In this connection, during 1993 and 1994, Ms. Mitic purchased tens of thousands of dollars’ worth of various items of furniture, rugs, and other decorator items that were placed in petitioners’ residence. She purchased those items in an effort to begin an interior design activity that was based on the theory that petitioners’ residence was to be used as a showcase for prospective customers of that design activity. On the record before us, we believe that it is more reasonable to conclude that the expenditures relating to the removal of carpeting, installation of hardwood flooring, and painting throughout petitioners’ residence were incurred primarily to accomplish Ms. Mitic’s objective of converting petitioners’ residence into a showcase to be used in her interior design activity, rather than “primarily for the prevention or alleviation of a physical * * * illness” of Ms. Mitic within the meaning of section 1.213-1(e)(1)(ii), Income Tax Regs.”

      • “In fact, the June 27, 1980 letter, as typewritten, merely stated that Ms. Mitic “has been found to be allergic to dust and would benefit from removal of the carpet in the bedroom”. Furthermore, we find that Ms. Mitic’s purchase in early February 1994 of a Chinese rug and a Persian rug for $8,370, which were placed on the newly installed hardwood flooring of petitioners’ residence, belies Mr. Mitic’s contentions (1) that the carpeting was removed from, and hardwood flooring was installed in, petitioners’ residence and the interior of that residence was repainted because Dr. Wolfe approved and recommended that that work be done and (2) that the expenditures for that work were medically related to Ms. Mitic’s asthmatic condition.”
      Thus, had the taxpayers only deducted the cost of removing the carpeting per the doctor’s recommendation shortly after receiving the letter from the doctor (not 13 years after the recommendation and in relation to a remodel for business purposes), then the court more than likely would have allowed the deduction. The taxpayers tried to deduct rental expenses while the carpeting was being removed. After removal of the carpeting, the taxpayer's purchased new oriental rugs. How is that following the doctor's reconmendation to get rid of the carpeting?

      Thus, your interpretation that this court case disallowed medical expenses for the removal of carpeting on a doctor’s recommendation is in error. The court found the taxpayers removed the carpeting for purposes other than for medical reasons. If anything, it proves one can in fact claim such deductions if that is what the expense is actually for.
      Last edited by Bees Knees; 04-04-2013, 12:36 PM.

      Comment


        #18
        A needed break from the action

        Worth a read? No, it is **NOT** a cite !!

        LINK ---->>> http://www.accountingtoday.com/galle...-1.html?taxpro

        (I thought the one about the "medical reasons" for needing a swimming pool might float, per several of the comments here.

        FE

        Comment


          #19
          Originally posted by Burke View Post
          I have a letter from a doctor who is recommending to a client that he pull up all carpet in the home and replace with hardwood floors; obtain a HEPA filter for the bedroom, and covering the mattress, pillows and box springs with allergen-proof encasing -- "all medically necessary." Flooring = $3,192 + $2,550 installation; don't have receipts yet for the others. I think he said he bought a new mattress.
          Would you consider this letter sufficent to take deduction?
          I would use my own judgement after interviewing the client. Would they have replaced the flooring if not for the medical advice? If so, then yeah, I'd take it and keep a copy of that letter in the workpapers. The new mattress? Same thing. Is it hypoallergenic? Would they have purchased a new mattress without the allergy problem? If not, then I'd take it. And I'd definitely keep notes regarding that conversation. Maybe even have the client sign a statement.

          Comment


            #20
            Thanks to all for the cites, advice and their experiences. Very interesting reading, especially the court case. Glad to have it. I am still holding this return as it has another issue that just resolved yesterday, and probably will recommend some deduction for the flooring, but certainly not all of it, maybe not even half based on FMV evaluation. Dr recommended covering mattress, have yet to see any documents on a new one.

            Comment


              #21
              Some more - with a tongue-in-cheek perspective

              I think I need to look into this potential medical deduction:

              LINK

              It would help considerably if I could write off the total cost of my CDs and DVDs as "doctor recommended therapy."

              And, of course, being in the tax business at this time of year, I'm CERTAIN getting a blu-ray of "Les Misérables" would be a most appropriate medical and/or business deduction!

              "Look down....look down....1040s at your feet...."

              FE

              Comment

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