You may be eligible to deduct the cost for a swimming pool if you or your loved one have a medical condition that requires it. This tax break can also be applied to medical expenses like assistant medical equipment, which is something many Americans don’t know about.
Use a swimming pool as a tax deduction
Aaron Rogers, owner of Southern Poolscapes informed a customer recently that they could claim a portion of their pool construction as a tax expense deduction. Rogers said that Rogers built the pool for therapy following a recent spinal fusion. “As we tallied up the bill, he mentioned to me, “boy, I wish this could be claimed on my taxes.”
Rogers says it’s not the first time Rogers has seen this, but his customer had all the paperwork and a large portion of her pool was tax-deductible. Rogers stated that his net deduction was close to $50,000. In some cases, however, the IRS will allow it if the doctor has approved it.
Medical Deduction for Spas & Swimming Pools
The medical tax deduction can be claimed for therapy pool and similar facilities that have been recommended by a doctor. These costs can also be claimed if you require assistance medical equipment, such as safety rails or a chair lift.
A doctor may recommend that you install a pool or hottub at your home for many medical conditions such as arthritis, multiple sclerosis, osteoporosis, and chronic pain. A lot of people use pools for physical therapy. This is especially true if they are unable to support their entire weight on one leg or another part of their bodies.
How to Claim Your Pool As a Tax Write-Off
Additionally, the tax deduct can be claimed if a pool is built for medical purposes. A pool can be expensive, but the doctor may recommend that the deduction be taken to offset the cost. A pool can be a therapeutic benefit for those with medical conditions, improving their quality-of-life.
It is important to remember that the medical expense deduction has some limitations. First, you must itemize deductions on Schedule A instead of taking the standard deduction. To be eligible for the deduction, eligible expenses must exceed 7.5% of your adjusted gross income (AGI). If a couple has an AGI above $200,000, then they cannot deduct eligible medical expenses over $15,000.
Who is eligible?
According to the most recent IRS data, 4 million tax filers claimed medical expenses in 2020 as a deduction on Schedule A. This contrasts with the 12 million filers that claimed mortgage interest, and the 13 million who claimed charitable donations. The average medical expense deduction was $20,000. This indicates that the deduction was very valuable to those who were eligible and came at a time when tax relief was highly appreciated.
It doesn’t matter if medical expenses are not above the threshold for deduction, but it is important to know what expenses qualify. The reason is that the same expenses that are eligible to be deducted can also be reimbursed via a Flexible Spending account or Health Savings account, but without having to meet the 7.5% AGI threshold.
You can claim a medical expense deduction for your pool
You will need to keep detailed records and documentation about all medical expenses related to the pool’s construction or any other expenses in order to claim the medical expense deduction. In Publication 502, , the IRS has a complete list with eligible medical and dental expenses. This includes costs related to diagnosis, cure, mitigation or treatment of disease. You can find examples such as guide dogs, bandages, assisted living and nursing home care, and tuition for special-education.
At least one case was rejected by the IRS for allowing a taxpayer to deduct pool installation costs because he did not have enough medical documentation. Although the taxpayer provided only a letter from his doctor informing him to lose weight it was not sufficient to be eligible for the medical expense deduction. To avoid denial of the deduction, it is important to have all documentation required by IRS.
The IRS maintains a extensive list of tax-deductible home improvements that are available for a medical deduction. Although a swimming pool is a capital expense, it can still be eligible for a medical deduction.
Must obtain an appraisal of the value of the property after claiming a medical expense. The appraised value must be subtracted from the amount of the deduction. This is done to stop taxpayers from taking a deduction for expenses not directly related their medical condition.
Claim Your Swimming Pool as a Deduction originally appeared on PoolMagazine.com. Get the Latest Pool News.
