by Pat Latham J.D.
A recent IRS private letter ruling dealt with payments to a private
school on behalf of two children diagnosed with learning disabilities.
The children were attending the private school in order to participate
in a special education program designed to help the children deal
with their conditions and then progress to a regular school program.
The question addressed was whether or not the payments would qualify
as tax deductible medical expenses.
In the ruling, the IRS clarified that what matters is not the
nature of the school but the special education provided to the student.
The letter states: "Deductibility of tuition depends on exactly
what the school provides an individual because a school can have
a normal education program for most students, and a special education
program for those who need it. Thus, a school can be 'special' for
one student and not for another." So, the tuition can be deductible
even if the school is not a special needs school and is not attended
exclusively by children with learning disabilities, as long as participation
by a child with learning disabilities in a special program is the
reason the principal reason why the child is attending the school.
The IRS concluded that the two children were attending the private
school "principally to receive medical care in the form of
special education" and that the tuition was deductible as a
medical expense.
The IRS ruling added that a physician or other qualified professional
must diagnose the medical condition (e.g., learning disability)
requiring the special education. Also, for the education to be medical
care, the education must correct the condition or assist the child
in dealing with the condition so that the child can then progress
to a regular school program. The school need not have physicians
providing the care but must have professionals "competent to
design and supervise a curriculum providing medical care."
Note that medical expenses generally are deductible only to the
extent that the medical expense total figure exceeds 7.5% of the
taxpayer's adjusted gross income figure.
Also, note that a private letter ruling applies only to the taxpayers
who requested the ruling, but the ruling is informative as to the
IRS's analysis of the issue. Parents considering the deductibility
of special education expenses should consult with their tax advisor.
Patricia H. Latham, is a member of the LDA of America Board of
Directors and a Washington, DC attorney, arbitrator and co-author
of six books including Learning Disabilities and the Law.
|
