IRS Publication 502, Medical and Dental Expenses, is the document that explains when a home improvement made for medical reasons can be counted as a medical expense on a federal income tax return. Under its capital expense rules, the cost of special equipment installed in a home, or of improvements to the home, can be a medical expense when the main purpose is medical care, reduced by any increase the improvement makes to the value of the home. A walk-in tub purchased for medical reasons may fall within those rules when a physician has documented the need, but whether it does in your case, and how much you may deduct, is a question for a tax professional. Ella's Bubbles cannot give tax advice; this page simply walks through what the publication says so you can have a clear conversation with the person who prepares your return.

What Publication 502 Counts as Medical Expenses

Publication 502 defines medical expenses as the costs of diagnosis, cure, mitigation, treatment or prevention of disease, and for the purpose of affecting any part or function of the body. It then works through a long alphabetical list of specific items. The portion that matters for a bathroom project is the section on capital expenses, which says you can include "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 words "main purpose" carry the weight: a change made for convenience or general remodeling is not a medical expense, while a change made because a person needs it to bathe safely may be.

Read the official guidance: IRS Publication 502, Medical and Dental Expenses.

Capital Expenses for Home Improvements Made for Medical Reasons

A capital expense is a permanent improvement to your property. Normally these are not deductible at all, which is why Publication 502 gives them their own rule. The rule has two parts: the improvement must have medical care as its main purpose, and the deductible amount is limited by the home-value test described below. The publication also says that amounts you pay for the operation and upkeep of such a capital asset qualify as medical expenses as long as the main reason for them is medical care, and it adds that only reasonable costs to accommodate a home to a disabled condition are considered medical care; additional costs for personal motives, such as architectural or aesthetic reasons, are not.

The Home-Value Test and the Examples IRS Lists

If a medically motivated improvement increases the value of your home, only the part of the cost that exceeds the increase in value counts as a medical expense. If the improvement does not increase the value of the home, the entire cost can count. Publication 502 lists a set of improvements made to accommodate a home to a disabled condition that, in its words, "don't usually increase the value of the home," and the list reads like an accessibility checklist:

Whether a walk-in tub increases your home's value is a fact question about your home and your buyer market, and our article on whether a walk-in tub adds value to your home explains why the answer depends on who the next buyer is. A tax professional may suggest an appraisal or a written opinion if the value question is not obvious.

The Adjusted Gross Income Threshold and Itemizing

Two more rules apply to every medical expense, not just home improvements. First, medical expenses are deducted on Schedule A of Form 1040, which means you must itemize deductions rather than take the standard deduction. Second, you can deduct only the part of your total medical and dental expenses that is more than 7.5 percent of your adjusted gross income. The arithmetic, and the choice between itemizing and the standard deduction, depends on your whole return, which is one more reason to bring the question to a tax professional.

Records to Keep

The IRS can ask you to substantiate any deduction, so keep a file from the day you start planning:

• A letter or prescription from the person's physician describing the condition and stating that the bathing modification is for medical care
• The written proposal and invoice for the tub itself; the article on proposals and order confirmations describes those documents
• Receipts from your licensed installer, plumber and electrician, kept separately, since installation involves several trades
• Any sales tax paid, which appears on your order documents; see sales tax, customs and duties on your order
• An appraisal or written valuation if your tax professional wants evidence about the change in home value
• Records of any payment you received from insurance, a grant or another source toward the project, since Publication 502 says you cannot include medical expenses that were paid by insurance companies or other sources

Ella's Bubbles Cannot Give Tax Advice

Ella's Bubbles is a manufacturer. The team can supply the proposal, invoice, specification sheet and product documentation your preparer asks for, and can explain the tub's accessibility features, but it cannot tell you whether your purchase is deductible, how the home-value test applies to your house, or how to complete your return. Please bring this page and your file to a tax professional, who can read Publication 502 against your own facts. Ask your Ella dealer or the team at (800) 480-6850 for any product document you need, or open a request at ellasbubbles.com/support.

Related Guides

• Will Medicare, insurance or the VA pay for my walk-in tub?
• Does a walk-in tub add value to your home?
• Financing your walk-in tub

Common Questions