Drug and alcohol rehab is prohibitively expensive, but one of the most effective ways of helping a person combat his or her substance addiction. As a result of these high costs, many people are interested in ensuring that they get as much money back as possible. One of the most effective ways that can be used to accomplish this goal is to have them deducted from a person’s taxes.

Where Can Those Deductions be Made?

The way that these bills are able to be deducted is by itemizing each of them in Section A. Section A allows any medical bills or dental bills to be deducted from the payments that are needed for taxes, as long as those bills were more than 10% of a person or family’s income. For those who have a spouse over the age of 65, the bills need to exceed more than 7.5% of a person’s annual income. According to the IRS, “Medical care expenses include payments for the diagnosis, cure, mitigation, treatment, or prevention of disease, or payments for treatments affecting any structure or function of the body” and can be deducted from a person’s taxes.

Will the IRS Object?

No. Even though the public is in conflict with regards to whether alcoholism, drug abuse, and other substance abuse is a problem that needs to be treated, the IRS is confident in its opinion that drug rehab is a medical expense.

Can Other Expenses Besides the Rehabilitation Clinic Itself Also Be Deducted?

Yes. All expenses that are needed in order for someone to help recover from a substance addiction are covered under §213(d)(1)(A) of the tax code. These expenses could include the hospital staff that are needed to provide support during a detoxification procedure, ambulance rides, prescription medications needed to treat any other addictions or remove cravings, additional tests that need to be run such as x-rays and CAT scans, and psychological treatment such as therapy and group sessions.

Are Premiums Considered to be a Medical Expense?

Yes. Medical insurance premiums are considered to be a medical expense because they are essentially when a person is paying out of his or her own pocket before the insurance company will start paying out. The money that was paid by the insurance company cannot be deducted, but the money that was paid to the insurance company can be.

How Do Reimbursements Come Into Play?

The amount of money that can be deducted with regards to medical expenses needs to be lowered by the amount of money the person paying might have been reimbursed. This is because he or she did not actually spend that money and therefore should not be able to put it in his or her tax deductibles.

What Cannot be Deducted?

There are a few different expenses that cannot be deducted when a person goes to drug or alcohol rehab. The first is over the counter medications, such as ibuprofen and other painkillers. General “well-being” trips can also not be deducted from taxes because they are not considered to be medically necessary.

Can Travel be Deducted?

Yes. The IRS understands that not a lot of people live near convenient drug rehabilitation clinics and allows the amount of money that is spent transporting the person to and from the center to be deducted from the overall amount of money that is deducted during the course of a person’s stay at rehab. This can include both the plane, as well as the taxi, that will allow the patient to reach the center.