Taxes & Special Needs w/ Brandon Layo
Email: email@example.com | Phone: (301) 846-9336
For individuals and families with disabilities, tax planning can often get overlooked. It can be overwhelming, trying to keep track of your medical expenses. There is a LOT of information on social media giving advice on what you should do. Unfortunately what works for you may not work for someone else. Circumstances differ, it's important to take your situation into account.
In this video, we explain the difference between standard deduction and itemizing. We talk through some situations when itemizing makes sense. There is an error on the slide. The medical deduction in 2020 is 10%, not 7.5%. This means you cannot deduct medical expenses until they have exceeded 10% of your income. For example, if you make $100,000/year you would have to wait until you've spent at least $10,001 on medical expenses.
We do not do a deep dive into examples of medical expenses. There are a LOT. A few we mention are mileage and hotel costs when traveling to a medical facility and costs associated with a service animal. Please note - a service animal is NOT the same thing as an emotional support or therapy animal. Tax treatment may not be the same. If you have an emotional support or therapy animal and you are wondering if any of the associated expenses are deductible I encourage you to talk to an accountant.
Brandon talks through tax credits and deductions. Tax deductions will lower your taxable income. Tax credits will reduce your income tax. Credits are more valuable. There are refundable and non-refundable credits. A refundable credit is a credit that is paid even if no taxes are due.
In some cases, it makes sense to claim your adult child as a dependent. Brandon stresses the key thing to determine is if you can. Do you meet the requirements? Typically this would mean you are providing at least 50% of the support. However, you will want to double-check because tax laws change.
After reviewing this interview and reflecting on my own experiences, I've created a tax guide I believe will help. You can find it here - https://www.specialneedsnavigator.us/marketplace/taxguide
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Podcast (ABC's of Disability Planning) - https://audioboom.com/channels/5039157
Resource store (free downloads too) - https://www.teacherspayteachers.com/Sellers-Im-Following/Add/Special-Needs-Navigator