When your parent needs help with activities of daily living (ADLs), one of the most supportive and flexible options is assisted living. These communities offer help with everyday tasks like getting dressed, managing medications, and preparing meals, all while giving residents space to enjoy their independence.
For families navigating the cost of senior living, it’s natural to wonder what kind of financial relief may be available. The good news is that, in some cases, assisted living expenses may be tax deductible. This deduction can help ease the financial impact of long-term care and make planning more manageable.
How much does assisted living cost?
According to Argentum, the average cost of a private one-bedroom apartment in assisted living is over $3,000 per month.1 Many communities use a tiered pricing model, where a base rate covers essential services and added costs reflect additional support. Because each resident has a unique care plan, getting an exact quote often depends on their individual needs.
Is assisted living tax deductible?
It can be—under the right conditions. The IRS allows some medical and long-term care expenses to be deducted if they exceed 10% of a person’s adjusted gross income.2
To qualify for this deduction, your parent or loved one must meet these criteria:
- A doctor or nurse must certify that they are chronically ill, meaning they need help with at least two ADLs or have cognitive impairments such as dementia.
- A care plan must be in place, created by a healthcare provider or the community itself.2
Even if your parent doesn’t meet the “chronically ill” threshold, they may still qualify to deduct certain medical-related expenses.
Who is eligible to claim the deduction?
If your parent is legally considered your dependent, lives in the U.S., Canada, or Mexico, and you cover more than 10% of their support, you may qualify under a multiple support agreement. Otherwise, your parent may claim the deduction on their own.3
What medical expenses can be deducted?
When you itemize on your tax return, the following types of expenses may be deductible.2
- Prescription drugs and insulin
- Dental care, including x-rays, fillings, and dentures
- Travel for medical appointments
- Medicare Part B and other health insurance premiums
- Assessment and care planning fees
- Nursing services, even by non-licensed caregivers
- Meals and lodging when care is the primary reason for residence
- Certain in-home medical supplies, like briefs or specialty diets
- Medical equipment and home modifications if related to care
- Long-term care housing, food, and support—if the resident is chronically ill
Some states also offer deductions. In Massachusetts, for example, residents over 65 may be eligible for the Senior “Circuit Breaker” tax credit (up to $1,070), plus a deduction of up to $3,000 for rent paid.4
Additional financial support for assisted living
If tax deductions don’t go far enough, families may also consider:
- Long-term care insurance
- Medicaid programs
- Veterans’ benefits
- State-funded initiatives like MassHealth PACE, PCA, or GAFC
- Affordable housing programs (e.g., Low-Income Housing Tax Credit)
- Room-sharing opportunities within the community
Find a helping hand
At The Arbors and The Ivy, we’re here to guide families through all aspects of assisted living—from emotional readiness to financial planning. Our Massachusetts and Connecticut communities offer individualized care plans, comfortable apartments, and warm, supportive staff who are happy to help you understand your options.
Explore the cost of senior living and how we can help make it manageable. Contact us today for more information.
Footnotes
- Genworth. “Cost of Care Survey.” Accessed April 14, 2025.
- Internal Revenue Service. “Publication 502: Medical and Dental Expenses.” Accessed April 14, 2025.
- Internal Revenue Service. “Publication 501: Dependents, Standard Deduction, and Filing Information.” Accessed April 14, 2025.
- Massachusetts Department of Revenue. “Senior Circuit Breaker Tax Credit.” Accessed April 14, 2025.