Article Date:
February 2017

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Special Needs Education Can Qualify as a Business Expense—Here’s How

Let’s say that you have a child with some learning disabilities that can be substantially (possibly totally) overcome if he attends the Lab School of Washington, located in Washington, D.C. The tuition alone is about $45,000.


You would think that with all the emphasis on health care, you could simply deduct the cost from your taxes. That’s not so. In fact, your ability to deduct medical costs on your Form 1040 has dwindled in recent years.


Let’s just call the Form 1040 itemized medical deduction a poor second choice.


The first choice is the one-employee health reimbursement arrangement (HRA) that’s exempt from the Affordable Care Act. This plan could allow you to deduct the entire cost of your child attending the Lab School and obtaining the proper therapy.


In this article, we are going to call this plan the 105-HRA to identify the tax code section that makes it available and distinguish it from other HRAs, such as the QSEHRA that we explained last month. To put this 105-HRA to work for you, you have to meet or create the right circumstances in your business. ... Log in to view full article.

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