Is therapy tax deductible?

If you’re wondering “Is therapy tax deductible?” there are likely many additional questions on your mind.

For example, can you write off therapy on your taxes? And, if so, can you write off therapy as a business expense? Or, does therapy count as a medical expense for taxes?

Also, if you can write off therapy on your taxes, what, exactly, can you write off—and how do you go about doing so?

This article will highlight what you can (and can’t) write off, both for therapy clients and therapists.

Can you write off therapy on taxes?

Let’s jump right in with the big question: Can you write off therapy on your taxes?

And the answer is—maybe.

“Therapy can sometimes be written off on your taxes,” says John S. Morlu, Certified Public Accountant (CPA) and CEO of accounting firm JS Morlu LLC.

Let’s take a look at what that “sometimes” actually means.

Does therapy count as a medical expense for taxes?

The first example of when therapy may be considered tax deductible is if it qualifies as a medical expense—and your total medical expenses for the year exceed the IRS threshold.

“Therapy can be written off on taxes if it qualifies as a medical expense—which must exceed 7.5% of your adjusted gross income,” says David Brilliant, founder of Northern California-based Brilliant Law Firm and an attorney that specializes in taxation.

So, when does therapy qualify as a medical expense?

“Therapy can be considered a medical expense if it is prescribed or deemed necessary by a healthcare provider to treat a specific mental or physical health issue,” says Morlu. “This includes therapy for conditions such as depression, anxiety, PTSD, or other diagnosable mental health conditions.”

So, the first piece of the puzzle in determining  “is therapy tax deductible?” is figuring out whether your therapy sessions count as a medical expense.

And, if it does, the next piece of the puzzle? Ensuring that you’re eligible to deduct medical expenses on your taxes—which again, has to do with how much your medical expenses tally up to in cost for the year and whether that tally hits or exceeds the IRS threshold.

“Medical expenses are deductible only if they exceed 7.5% of your adjusted gross income (AGI),” says Morlu. “For example, if your AGI is $50,000, only medical expenses exceeding $3,750—[which is] 7.5% of $50,000—are deductible.”

Itemizing deductions

If you determine that your therapy qualifies as a medical expense and you’re eligible to deduct medical expenses on your taxes, you’ll need to break down exactly what those medical expenses are.

“To deduct therapy as a medical expense, you must itemize your deductions,” says Morlu. “You must itemize deductions on Schedule A of your tax return [and] the therapy must be for a diagnosable medical or mental health condition.”

As such, it’s important to track all of your medical expenses (including therapy) and keep detailed records throughout the year.

Why?

Not only will it ensure that you’re able to accurately outline the deductions on your taxes, but it will also allow you to justify those costs in the case of an audit.

“To write off therapy, clients should keep detailed records, including receipts and prescriptions, to substantiate the medical necessity,” says Brilliant.

Is counseling tax deductible?

So, what about counseling? Is counseling tax deductible?

Similar to therapy, you can write off counseling for medical purposes (and if your medical expenses hit or exceed the IRS threshold).

“Counseling is tax deductible if it meets the IRS definition of a medical expense,” says Morlu.

For example, if you received counseling for a depression diagnosis or as a part of substance  use treatment—and that counseling was ordered by a healthcare provider—it may be tax deductible.

“Un-prescribed personal counseling for general well-being, however, is not deductible,” says Morlu.

Can therapists write off therapy?

Up until this point we talked generally about whether therapy is tax deductible.

But, what about tax deductions for therapists, specifically?

Are there additional situations where therapists may be able to write off therapy on their taxes?

And the answer to that is yes.

Like anyone else, therapists can write off therapy so long as it qualifies as a medical expense—and so long as their medical expenses exceed 7.5% of their AGI.

However, therapists may also be required to attend therapy sessions as part of their professional training and certification requirements.

In those situations, can you write off therapy as a business expense?

“Therapists can potentially write off their own therapy if it qualifies as a business expense, such as professional development or stress management related to their practice,” says Brilliant.

More specifically, Morlu highlights that therapists may be able to write off therapy if it is:

• Directly related to maintaining or improving skills necessary for your business or job
• Part of an employer-mandated program or required to maintain your employment

However, Morlu also highlights that this can be a gray area—and stresses that “personal therapy for general mental health or self-improvement purposes is considered a personal expense and is not deductible as a business expense.”

And, in addition, he says, “Therapy for personal well-being, unrelated to your business operations, is generally not deductible as a business expense.”

What can therapists write off on their taxes?

So, for therapists who are themselves wondering “Is therapy tax deductible?” the truth is: therapy may or may not be tax deductible, depending on the circumstances.

However, while you may not be able to deduct therapy as a business expense, there are plenty of other tax deductions for therapists.

“Therapists can deduct a variety of business expenses,” Morlu says.

Morlu cites a variety of expenses therapists can deduct on their taxes, including:

• Office rental costs
• Professional licenses and memberships
• Education and training
• Supplies and equipment (for example, office furniture, therapy tools, books, office supplies, etc.)
• Marketing and advertising
• Business-related travel expenses, including business-related travel, conferences, or client visits
• Utilities and phone bills (when used for business purposes)
• Software and tools (like a practice management platform)

Not sure if you can deduct therapy? Talk to a tax professional

Bottom line to close out the question: “Is therapy tax deductible?”

“Therapy can be deductible as a medical expense for individuals if it addresses a diagnosed condition and exceeds the AGI threshold for medical deductions—while therapists can deduct business-related expenses for their practice, though personal therapy is typically non-deductible unless required for licensing or training,” says Morlu.

However, if you’re unsure about whether your therapy costs are tax deductible (or have any other questions related to your taxes), it’s important to speak with a tax professional.

Tax-related errors can be extremely costly—and getting professional insights and guidance can help you avoid those errors and ensure your taxes are accurate.

Sources

1. IRS. Publication 502 (2024), Medical and Dental Expenses.
2. IRS. Frequently asked questions about medical expenses related to nutrition, wellness and general health.
3. Intuit TurboTax. What Medical Expenses Are Tax Deductible?
4. IRS. Itemized Deductions.
5. IRS. Guide to business expense resources.
   

   

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