Drug and Alcohol Rehab Costs May be Tax Deductible

The cost of drug and alcohol rehab can be high, and if you opt for a high-end addiction treatment center to ensure that you have access to everything you need during your recovery, you can end up with a hefty bill.

Health insurance may cover part of the costs, and you can always get financing to cover the rest, but when it comes to tax time, can you recoup any of the costs?

Ways to Claim Rehab on Your Tax Return

As of right now, there are ways to claim the cost of drug and alcohol rehab on your tax return – as long as you itemize your deductions on Schedule A. In fact, any medical and dental cost is deductible in the same way, as long as it exceeds more than 7.5 percent of your adjusted gross income for the year. For example, if your adjusted gross income is $50,000, you can deduct the expenses that exceed $3750. So if your treatment costs $10,000, then you can deduct $6250.

So which addiction treatment costs are included as acceptable medical expenses that can be deducted? According to §213(d)(1)(A) of the Tax Code, medical costs are defined as “the diagnosis, cure, mitigation, treatment, or prevention of disease.”

Not a lot of guidance. The only other directives point out that illegal treatments or operations are not tax deductible and that a few services are definitely included. Some of the ones that relate to drug addiction treatment include x-rays, hospital and nursing services – pretty much any diagnostic, evaluation, and treatment services.

If you are enrolled in a drug detox program or a drug addiction treatment program and incur costs for psychological treatment or medical treatment – even an ambulance ride somewhere in the process of healing and getting better – then your costs are covered under the circumstances described above.

IRS Qualifications of Medical or Psychological Disease

Does drug and alcohol addiction qualify as a medical and/ or psychological disease according to the IRS? Absolutely. Even if the general public is split on the question, the medical establishment and the IRS are not.

They agree that costs incurred in the treatment of drug addiction is absolutely a medical expense and as such qualifies as a deduction for those who itemize and whose expenses exceed 7.5 percent of their income.


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By Wendy Lee Nentwig
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Dear Friends,

On November 10, 2018, the Woolsey Fire destroyed The Canyon at Peace Park’s treatment facility. At this time, The Canyon at Peace Park is not accepting patients for any services. We arranged for the safe and seamless discharge or transition of all patients when we were forced to evacuate due to the fire.

For over 12 years, The Canyon at Peace Park has been privileged to provide integrated treatment for addiction and co-occurring disorders to patients across the nation. Our main focus has always been on our patients and their success. We have served hundreds of patients and their families, providing exclusive treatment and services for a wide range of behavioral health and addiction issues.

Our trained, compassionate staff has been committed to delivering quality patient care with dignity and respect, with the goal of helping our patients return to their communities as healthier individuals. We are extremely proud of the sacrifices of those who worked every day, often under challenging circumstances, to positively impact our patients’ lives.

We thank the physicians and staff for their expertise and dedication in providing high quality, compassionate treatment and care to the patients we have served.

We look forward to carrying on The Canyon at Peace Park’s legacy through our outpatient locations in Santa Monica and Encino. Foundations Recovery Network also has other residential and outpatient facilities around the country offering the same high quality of service you’ve come to expect from us.

If you need help finding treatment, please visit foundationsrecoverynetwork.com or call for more information.

To request medical records please contact UHS-NRO Records Department. Fax a copy of the completed/signed ROI form to FAX# (615)-997-1200 or it can be emailed to [email protected] If you need additional guidance on medical records, please call (615) 312-5834

Sincerely,

The Canyon at Peace Park Leadership Team

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