How to Claim Your Hot Tub As A Medical Expense Deduction on Your Tax Return
Want to claim a deduction for your 2016 hot tub purchase?
We all know that April 18th is tax day. A visit from our accountant this morning brought the impending date into stark awareness. Taxes are no one’s favorite topic unless you’re an accountant or work for the IRS. You want to pay your fair share, but why pay more than you have to, right? It’s always wise to be aware of possible deductions that will reduce your overall tax bill.
IRS regulations may allow a deduction for your hot tub purchase if your doctor recommends hot water therapy for a medical condition. Which is good news for a lot of people. One of the major reasons for people purchase a Hot Spring Spa is a medical condition for which a hot tub will provide relief.
Those who suffer from arthritis, RLS, chronic fatigue, fibromyalgia, back pain or other medical problems typically find that their aches and pains are alleviated by hot tub soaking. There are many medical conditions for which a hot tub purchase may qualify for a medical deduction including injuries suffered in an automobile accident.
A doctor’s prescription can turn your hot tub into a piece of deductible medical equipment, as long as you satisfy a few IRS conditions. Remember that a written recommendation is the first and most important step in the deduction process.
Look for IRS Publication 502, which covers medical expenses. According to IRS Publication 502, 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 include the costs of equipment, supplies, and diagnostic devices needed for these purposes. However, 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 beneficial to general health.
Deducting Capital Improvement Expenses
You can include in medical expenses amounts you pay for special equipment installed in a home, or for improvements, if their main purpose is medical care for you, your spouse, or your dependent. The cost of permanent improvements that increase the value of your property may be partly included as a medical expense. The cost of the improvement is reduced by the increase in the value of your property. Only the difference is a medical expense. If the value of your property is not increased by the improvement, the entire cost is included as a medical expense. Actual increase in value to the home is best determined by an appraisal.
You’ll find a good discussion of the IRS regulations and helpful hints for obtaining this deduction at Hurt911.org The Center for Accident and Injury Insurance. The founder of this site also recommends products for physical therapy that he has purchased and uses himself including a Hot Spring Spa. If you’re in the market for a hot tub, read his story.
If you need a copy of your receipt for a hot tub you purchased and had delivered last year, call our office 503-533-5603. This post is no substitute for consulting your own tax preparation expert for assurance that you qualify for using the hot tub as a medical expense under IRS rules.
Let us know about your own success with taking a medical deduction for your own home hot tub!