Running your own business is hard enough. The problems compound when you try to balance it with life (friends and family) and if you’re trying to balance side-projects. Add to this our post-calling-it-post-COVID times, and it’s easy to succumb to overwhelming stress. It’s why many people resort to therapy.
Of course, therapy is a valuable tool for improving your mental health and well-being, but it can also be expensive. If you’re already struggling to make ends meet, you may be wondering if you can deduct the cost of therapy on your taxes. And the answer is… yes!
Therapy can be a write-off for your business if it is considered a necessary expense for your mental health and well-being. This is because the IRS considers your mental health to be a business asset, and any expenses that you incur to maintain that asset are deductible.
How therapy can qualify as a business expense
To qualify as a business expense, the therapy must be directly related to your business. For example, if you are a therapist, you can deduct the cost of your own therapy sessions because it helps you to be more effective in your work (duh). However, similarly, if you are a business owner who deals with a lot of stress, you can deduct the cost of therapy sessions that help you to manage your stress so that you can be more productive at work.
Is all therapy deductible?
Not all therapy expenses are deductible, however. For example, you cannot deduct therapy expenses that are for personal reasons, such as dealing with grief or relationship issues. You also cannot deduct therapy expenses that are not directly related to your business, such as if you see a therapist for stress relief unrelated to your work.
If you are unsure whether or not an expense is deductible, it is always best to consult with a tax professional. They can help you to determine which expenses are eligible for a deduction and how to properly document your expenses.
Here are some examples of therapy expenses that you may be able to deduct:
- Therapy sessions with a licensed therapist. This includes both in-person and online sessions.
- Therapy-related travel expenses. This includes mileage, airfare, and hotel stays if you need to travel to see a therapist who is not located near you.
- Therapy-related books and materials. This includes books, workbooks, and other resources that you use in therapy.
- Therapy-related memberships and subscriptions. This includes memberships to professional organizations and subscriptions to therapy-related journals or magazines.
In addition to the expenses listed above, you may also be able to deduct the cost of other expenses that are related to your mental health and well-being, such as:
- Health insurance premiums that cover mental health care.
- Medications for mental health conditions.
- The cost of participating in support groups or other mental health-related activities.
If you are able to deduct the cost of therapy on your taxes, it can save you a significant amount of money. This money can then be used to offset other business expenses or reinvest in your business.
If you are considering seeking therapy, it is important to remember that the cost of therapy may be tax-deductible. This can make therapy more affordable and accessible, which can benefit both your mental health and your business.