Mr. Smith has been severely injured an automobile accident, which has damaged both of his legs. As a part of the rehabilitative treatment, he has been prescribed, by his doctor, a regimen of exercise, specifically, daily swimming.

In the current tax year, Mr. Smith purchases, for $175,000, a house with an existing pool. He spends $1800 in other medical expenses, and $500 on pool maintenance. Since the accident was last year, he has no further expenses, except for the purchase of the house with the pool. Of course this $2300 total ($1800 on medical expenses and the $500 on the pool maintenance) is deductible, if he can meet the 7.5% of Adjusted Gross Income threshold. So the crux of the question is, can he deduct anything for the purchase of the home with pool, and thus push himself over the threshold, into the happy land of itemized minimum deductions.

Unfortunately, and counter-intuitively, the answer is no. Admittedly, Mr. Smith purchased a house with an asset, in this case, the pool, primarily for his own rehabilitative care. Quite possibly, Mr Smith would never have thought of buying a house, with such an aquatic appliance, had it not been for the accident. He may even detest the darn thing as a nuisance. He may also loathe the vampiric drain upon his income, from the myriad of maintenance expenses incurred by owning a pool. All those concerns are of no consequence.

The governing determination, in this matter, may be found in the IRS Publication 502, Medical and Dental Expenses, which states “The cost of permanent improvements that increase the value of your property may be partly included as a medical expense. The cost of the improvement is reduced by the increase in the value of your property. The difference is a medical expense.” (IRS Publication 502, November 10, 2009, page 6) So, a medical care expenditure, which also improves the intrinsic value