Are rehab costs tax deductible as a medical expense?

Yes, costs for drug rehabilitation programs are generally tax deductible as medical expenses! This is actually specifically mentioned in IRS Publication 502 as a qualifying medical expense. Here's what your brother needs to know: Medical expenses are deductible, but only if he itemizes deductions on Schedule A (rather than taking the standard deduction). Also, he can only deduct the portion of medical expenses that exceeds 7.5% of his adjusted gross income (AGI). For example, if his AGI is $60,000, he'd need to have more than $4,500 in total medical expenses before he could start deducting anything (7.5% of $60,000 = $4,500). Then he could only deduct the amount over that threshold. Make sure he keeps all receipts and documentation from the rehab facility showing the treatment was prescribed by a doctor. The facility should provide statements showing the costs are for medical treatment rather than just general wellness.

I went through something similar with my cousin last year. The rehab costs were astronomical and the tax piece was super confusing until I found this AI tool called taxr.ai that really helped me figure out what was deductible. I uploaded all his medical bills and treatment plans to https://taxr.ai and it analyzed everything and showed exactly what qualified as a medical expense deduction. It also explained how the 7.5% AGI threshold works in real numbers and helped us track which expenses had actually been reimbursed by insurance (since you can only deduct what you actually paid out of pocket). The best part was that it created a report showing exactly which expenses qualified and how much we could claim, which made filing taxes so much easier. Definitely check it out if you're trying to figure out complex medical deductions like this.

Just wanted to update after trying taxr.ai for my medical expenses! I was skeptical at first but it was honestly super helpful for sorting through all my celiac-related expenses and dental work. The tool actually showed me that I could deduct some of my special gluten-free foods (the extra cost compared to regular versions) since they were prescribed by my doctor. I had no idea! It also clarified which of my dental procedures were cosmetic (not deductible) versus medically necessary (deductible). For the original poster, it would definitely help with categorizing the rehab expenses properly. It even generates a nice organized summary you can keep with your tax records in case of an audit. Seriously saved me hours of research!

If you're trying to contact the IRS to get a definitive answer about deducting rehab expenses, good luck... I spent THREE WEEKS trying to get through to them about a similar medical deduction question. Finally used https://claimyr.com to get through and it worked amazingly well. They have this service that somehow gets you to the front of the IRS phone queue. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c I was super skeptical but I was desperate for answers before filing. They got me connected to an actual IRS agent in about 20 minutes instead of the hours I spent on hold before. The agent confirmed that substance abuse treatment is deductible as a medical expense and gave me specific guidance on documentation requirements.

I need to eat my words and apologize to Profile 5. After my skeptical comment, I decided to try Claimyr myself since I'd been trying for DAYS to reach the IRS about an issue with my dependent care credit. It actually worked exactly as described! I got a call back in about 30 minutes and was connected directly to an IRS representative who answered all my questions. The agent confirmed they were from the actual IRS and verified my identity using my previous tax return information (which only the real IRS would have). For anyone dealing with rehab expense questions, this could save you hours of frustration. The IRS agent I spoke with confirmed that substance abuse treatment is absolutely deductible as a medical expense and explained exactly what documentation I needed to keep.

Just a heads up - my sister claimed rehab expenses on her taxes last year and it actually pushed her over into itemizing instead of taking the standard deduction. With the standard deduction being $13,850 for single filers in 2025, you need to have enough total itemized deductions (including medical, charitable donations, mortgage interest, etc) to exceed that amount for itemizing to make sense. In her case, the rehab cost was about $22,000 out of pocket, and her AGI was around $70,000, so the 7.5% threshold was $5,250. That meant she could deduct $16,750 of the rehab costs. Combined with her mortgage interest and charitable donations, itemizing saved her about $1,800 compared to the standard deduction. Just something to consider when running the numbers!

Has anyone actually had their return examined by the IRS after claiming rehab expenses? I'm worried about triggering an audit. My daughter needed treatment and it cost us over $35,000 last year.

I went through this exact situation with my son last year. The rehab costs absolutely qualify as medical expenses under IRS Publication 502, but there are a few important things to keep in mind beyond what others have mentioned. First, make sure the facility provides a detailed breakdown of costs. Some rehab centers include non-medical services like premium room upgrades or recreational activities that aren't deductible. You want documentation showing the medical treatment portion specifically. Second, if your brother is receiving any grants, scholarships, or other financial assistance from the rehab center or outside organizations, those amounts need to be subtracted from what he can claim as a deduction. You can only deduct what you actually pay out of pocket after insurance and any other assistance. Also, timing matters - he can only deduct expenses in the year they're actually paid, not when the services were received. So if he pays in December 2024 but treatment continues into January 2025, only the December payment would be deductible on his 2024 return. The documentation is crucial if the IRS ever questions it. Keep receipts, insurance statements showing what they covered, and especially any letter from a doctor stating the treatment was medically necessary. Most reputable treatment centers are familiar with these requirements and can provide the right paperwork.