Have Disabilities and Work? IRWEs Make Huge Dent in Income Tax

At tax time, we want to squeeze out every deduction possible: medical, dental and that accessible van you bought. But did you know that expenses you paid to a caretaker to help you get ready for work are also deductible? If someone comes in to help bathe and dress you, cook for you or drive you to and from work – that’s deductible under a little known IRS area called Impairment-Related Work Expenses (IRWE).

If you are an employed person with a disability, you qualify for IRWE deductions. According to the IRS, the disability “must substantially limit one or more of your major life activities, such as performing manual tasks, walking, speaking, breathing, learning or working.”

Examples of IRS approved deductions:

• The item(s) or service(s) enables you to work (home computer, accessible vehicle);
• You need the item(s) or service(s) because of a physical or mental impairment (adaptive equipment, caretaker);
• You paid the cost and are not reimbursed by another source such as Medicare, Medicaid or private insurance (mileage to and from work);

The cost must be “reasonable.” (It represents the standard charge for the item or service in your community, and you paid for the expense in a month you are or were working.)

IRWEs must be connected to your job, but not just at the office. If you must use a computer at home, it’s deductible. That software? Deductible!

Find a full list at Social Security Online – The Red Book at www.ssa.gov/redbook/eng/ssdi-and-ssi-employments-supports.htm#3.

IRWEs are not subject to the 7.5% limit of your adjusted gross income, as medical expenses are, so the IRWE is worth much more to the taxpayer. Also, IRWEs aren’t capped at 2% of adjusted gross income, like standard business expenses are.

More good news: You can always file amended returns up to three years after the payment of an IRWE.

Get IRS materials at www.irs.gov, IRS walk-in offices or call 800-829-3676.

This mobility safety update has been brought to you by NMEDA – the National Mobility Equipment Dealers Association. Need some information on how to make your vehicle wheelchair accessible or upgraded with the latest and most convenient features? Contact a NMEDA dealer in your local area. Your local NMEDA member is a mobility and accessibility equipment expert!