Aging in place has become more common in recent years. A person aging in place lives in the residence of their choice, for as long as they can, while they age. Aging in place usually requires making changes in the home and identifying support systems to allow seniors to live safely, independently and in familiar surroundings for as long as possible.
There are many choices to be made as we age. One of the most significant choices is where you want to live. Many people want to downsize, to live in a condominium, to live in an assisted living facility or to stay put. A survey performed by the AARP Public Policy Institute revealed that 87% of adults age 65+ want to stay in their current home and community as they age. Of people ages 50 to 64, 71% of people want to age in place.
Our Society is Aging
There are significant variations in life expectancy around the world. Factors which contribute to this variation include gender, genetics, public health, access to health care, diet, exercise, lifestyle and climate. Other factors include whether you are: male or female, rich or poor, and mentally ill or not. According to U.S. Census Bureau statistics, Andorra (located in the heart of the Pyrenees Mountains) currently has the world’s longest life expectancy of 83.5 years. Statistically the average life expectancy of all people in the world is currently 66.26 years (64.3 years for males and 68.35 years for females).
In the United States longevity has leveled off in recent years but has significantly increased overtime.
Demographers project by 2040, the U.S. population age 65 and older will double to 80 million and their share of the total population will rise from 13% to 20%. There are many factors contributing to a larger portion of the U.S. population being made up of older people. Some of those are the large baby boomer population, the lengthening of life expectancy and reduced birth rates.
Impediments to Aging in Place
Those who oppose aging in place say the care will not be as good; home maintenance will become more challenging; it is much harder getting around; there is significant loneliness because of lack of mobility and safety is a significant concern.
The proponents of aging in place contend that it can be cheaper than an assisted living facility or a nursing home. People who age in place feel safer, more secure and more independent since the individual usually remains in the neighborhood where they have lived for many years.
There are, however, many factors which make it difficult to age in place; for example, access to transportation, assistance with activities of daily living, an available support system and design and construction of homes.
Changing of Home Design Needed for Aging in Place
Those people who wish to remain in their home must consider their home design. Some thoughts:
- Are there stairs to navigate daily? Do you have a stair lift?
- Are there wide doorways to accommodate a wheel chair or walker?
- Do you have a zero-step entrance?
- Is there proper lighting and contrasting colors on floors to indicate floor level changes?
- Are your kitchen and bathroom fixture lower in height?
- Are there handrails, especially in the bathroom?
- Do you have first floor bathrooms?
This template is designed to help you make your plans for aging in place including whether you need modifications to your existing home.
Standard Deduction vs. Itemized Deductions
When you do your tax return you can either claim the standard deduction or itemize your deductions. You should choose the method which has a higher deduction and therefore lowers your tax. The standard deduction is a fixed dollar amount which varies based upon your filing status (single, married, over 65, blind etc.). Itemized deductions can reduce your taxable income. That is, every additional dollar of deductions reduces your tax by your effective tax rate.
One area which is part of itemizing deductions is medical expenses. However, the total of your qualifying medical expenses is not tax deductible. That is, deductions for medical expenses are only allowed after your total medical expenses exceed 10% of your adjusted gross income, or 7 1/2% if you are over 65.
Tax Deduction for Home Modifications
Usually you cannot deduct on your tax return the cost of permanent improvements to your home. However, these costs can be deductible as medical expenses if their main purpose is medical care for you, your spouse or dependent. You must itemize deductions in order to claim the costs and the medical expenses meet the threshold discussed above. In addition, the cost of the improvements must be reduced by any increased value to your home as a result of the modifications.
Certain improvements made to accommodate a home to your disabled condition, or that of your spouse or your dependents who live with you, don’t usually increase the value of the home and the cost can be included in full as medical expenses. These improvements, as listed in IRS Publication 502 include, but aren’t limited to, the following items:
- Constructing entrance or exit ramps for your home.
- Widening doorways at entrances or exits to your home.
- Widening or otherwise modifying hallways and interior doorways.
- Installing railings, support bars, or other modifications to bathrooms.
- Lowering or modifying kitchen cabinets and equipment.
- Moving or modifying electrical outlets and fixtures.
- Installing porch lifts and other forms of lifts (but elevators generally add value to the house).
- Modifying fire alarms, smoke detectors, and other warning systems.
- Modifying stairways.
- Adding handrails or grab bars anywhere (whether or not in bathrooms).
- Modifying hardware on doors.
- Modifying areas in front of entrance and exit doorways.
- Grading the ground to provide access to the residence.
Only reasonable costs to accommodate a home to a disabled condition are considered medical care. Additional costs for personal motives, such as for architectural or aesthetic reasons, aren’t medical expenses.
Capital Expense Worksheet
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