CAPITAL EXPENDITURES

Q. My doctor has recommended that I have heart surgery in the next few months because of my heart condition. I am going to need to install an elevator in my home, so I will be able to get to my bedroom on the second floor. Is any of this expense tax deductible?

A. Yes. The general rule is that capital expenses for medical care can be deducted as a medical expense to the extent that the cost of the permanent improvement exceeds any increase in fair market value of your property. With the help of a real estate professional, determine the amount, if any, the value of your house will increase with the installation of the elevator. Subtract the cost of the increase in value from the cost of installing the elevator. Any amount greater than zero equals the amount of medical expense you can add to other medical expenses for you, your spouse, and your dependents to arrive at the "Medical and dental expenses" figure to enter on Line 1 of your Form 1040, Schedule A.

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