My sister has recently received a ton of treatments and I have had to help her with the copayments. They have totaled over $50k this year and she is not claimed on my taxes. Is there any way I can get tax relief from all the out of pocket money I have spent?
2007-10-08 11:02:38 · 10 answers · asked by Paul J 1 in Business & Finance ➔ Taxes ➔ United States
This is you only chance...
she has to be a dependant.
Make her one. Put her name on one or more of your utility bills
and make a change of address now.
Have your accountant claim her and expenses on your taxes.
The worst that will happen is you can get audited within 7 years and have to pay back what was deducted. If you go past 7 years, then you are clear.
Do this anyways for any further bills you might pay in the future.
2007-10-12 10:48:53 · answer #1 · answered by warscoob 2 · 0⤊ 0⤋
I don't think you can claim it on your taxes as it stands now. The main reason is because the medical bills are not in your name. The total amount of money that you have spent also has to exceed the amount of your standard deduction. If it is 50,000, that definitely exceeds that! Also, I was told, (I tried to claim medical expenses on last years taxes), that you have to have paid the medical bill off in full for the year you are claiming them.
Your best bet, if your sister will agree to this, is to total up the amount that you have paid and draw up a document stating that you gave your sister this amount of money and put in the document that there is no set payment amount or date. I am not sure how the taxes would be on this for her though.
Your best bet would definitely be to use a tax consultant or accountant. This is also good because if you were ever audited a place like H&R block guarantees their services and if you end up owing anything because of an audit for the year that they did the taxes, they would pay it not you.
Good luck with whatever you do and I hope your sister is well/gets well.
2007-10-08 11:14:07 · answer #2 · answered by starashley46123 2 · 0⤊ 2⤋
While it is correct that you can claim medical expenses for a dependent, the person does not have to be your dependent for you to claim medical expenses.
Please read page 4 of the following IRS publication:
http://www.irs.gov/pub/irs-pdf/p502.pdf
In particular, if your sister was not a qualifying child and you provided over half of her support (and your medical expenses count as support), then her expenses may be deducted by you even though you cannot claim her as a dependent.
Or, if your sister is under 19 or under 24 and a full-time student, or permanently and totally disabled, lived with you over half the year, and did not support herself, then you could deduct her medical expenses even if you cannot claim her on your tax return (because, for example, she also lives with her parents).
2007-10-08 13:57:43 · answer #3 · answered by ninasgramma 7 · 0⤊ 0⤋
On the other side of this situation is if you paid this money to your sister, you are required to report this payment for Gift Tax purposes.
If you paid it to the medical provider directly, there is no Gift Tax return required.
2007-10-08 13:59:57 · answer #4 · answered by Mark S 5 · 0⤊ 0⤋
No, sorry, that is not deductible by you. Only the medical bills of the taxpayer and their dependents listed on the tax return are deductible.
2007-10-08 11:07:58 · answer #5 · answered by Bostonian In MO 7 · 0⤊ 0⤋
I'm assuming that she is filing her own return and using her exemption and deductions. But if she lived with you all year and you provided over half of her support and she didn't file a joint return, you should be able to claim her as a dependent and claim those expenses.
2007-10-08 11:50:59 · answer #6 · answered by Scott K 7 · 0⤊ 2⤋
You can deduct the amount that is over 7.5% of your income. It is an itemized deduction. You need more itemized deductions to be more than the standard deduction to make it worthwhile. Most times you cannot itemize unless you have a mortgage.
2016-05-19 01:45:25 · answer #7 · answered by ? 3 · 0⤊ 0⤋
Unless she is your dependent, and you've just said she isn't, you can't claim her medical expenses. Sorry. I know that's a lot of money, but believe me, you would be caught, so it simply isn't worth the risk of trying it.
2007-10-08 11:11:58 · answer #8 · answered by Anonymous · 0⤊ 0⤋
You may be able to write off the payments as a bad loan or bad debt. However, the IRS may go after your sister's taxable income (if any). Read the reference for details. Consult your tax professional for details!
2007-10-08 11:31:58 · answer #9 · answered by transformasian 2 · 0⤊ 3⤋
No, unfortunately. They'd have to be your bills, your spouse's, or bills for someone who is your dependent for you to be able to deduct them.
2007-10-08 12:23:01 · answer #10 · answered by Judy 7 · 0⤊ 0⤋