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Continuing Care Retirement Community

Submitted by bethabby on 23 June 2010 - 5:45pm

I'm interested in running a scenario in which my husband and I sell our home and move into a Continuing Care Retirement Community, probably in our mid-70's. We are mid-50's and still working now.

Does anyone have any experience with running this scenario that they could share? Aside from just the general way to go about this, I'm also wondering specifically about the medical deduction. My mother lives in such a community, and receives a significant income tax deduction because part of her monthly fee is considered a medical expense (even though she lives in an independent apartment). I'm wondering if ESPlanner can account for that.

Also, if anyone has any current entrance fee and monthly fee estimates pertaining to a married couple that they would be willing to post, that would be very helpful.

I took a look at the ESPlanner help, and didn't see any information on this scenario. But if I missed something, please let me know.

Thanks.

‹ Current housing report Buying new primary, renting out old primary then selling old primary ›
Submitted by Dick Munroe on 24 June 2010 - 7:50am.
1

I don't think there are any case studies here, but basically yes, ESPlanner can handle this but you have to do some of the work. In particular let's take your mother's housing expense.

1. She "rents" a home for $Z/month.
2. The rent contains 2 components $X (deductible) and $Y (not deductible).

To set this up, have her "rent" a home for $Y/month and have a deductible medical special expenditure for $X/month and, hey presto, you have accounted for her total rent ($X + $Y) and the part of it that shows up on her income tax forms as a deduction.

Similar strategies get applied in all sorts of places if you have expenditures that are partly deductible (or receipts that are partly tax free).

Best,

Dick Munroe

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