TAX LEVERAGED FINANCING OPTIONS FOR MEDICAL EXPENSES INCURRED BY FAMILIES CARING FOR THOSE WITH SPECIAL NEEDS:

ARE HOME EQUITY LOANS AND RETIREMENT PLAN DISTRIBUTIONS STILL VIABLE UNDER RECENT LEGISLATION?

BY THOMAS M. BRINKER JR., LL.M., CPA

As the number of children diagnosed with autism, Asperger's syndrome, and other intellectual disorders continues to skyrocket, the lives of all of those concerned are dramatically impacted. Recent statistics indicate that as many as 1 in 54 children born today have an autism spectrum disorder (Centers for Disease Control, March 27, 2020… citing an increase from 1 in 59 according to the CDC on April 26, 2018 and 1 in 68, according to the CDC on both March 28, 2014 and March 31, 2016 with boys 4 times more likely to be identified with an ASD than girls).

In addition, the CDC cites in this same 2020 report that about 1 in 6 (17%) of all children aged 3 to 17 have been diagnosed with a developmental disability (such as autism, ADHD, blindness, and cerebral palsy among others) with almost 1 in 4 American adults nationwide having a disability. Parents caring for those with special needs are often unaware that substantial tax benefits may be available to them and often forego hundreds, if not thousands, of potential tax deductions and reductions in their tax liability. Although we have previously focused on the expanded definition of medical care as an income tax deduction and other tax benefits for our families, another reality inevitably surfaces… finding the wherewithal to finance these expenditures. Parents of children with special needs quickly discover that medical care expenditures for their child can prove astronomical. As a result, parents and their advisors need to become familiar with some unusual Internal Revenue Code provisions