Remote Car Starter

[Guest Laura Browne]

I have a claimant who has submitted reimbursement for a remote car starter. They have a note from a physician stating this is needed "Due to heat; treatment of Multiple Sclerosis". I can find information that states A/C installed in homes to treat a medical condition is reimburseable. Would this also be reimburseable?

[Alf]

Multiple Sclerosis and they can't come up with more traditional expenses?

I would deny (dual-purpose, etc.), depending on what the plan permits. Also, I wouldn't rely too much on the A/C or home swimming pool examples. Very rare that you will find something like those that is defensible.

[Kirk Maldonado]

Alf:

While I agree that there are some abuses and a lot of close questions on dual-use property, there are some cases where it is justified.

Having had severe asthma as a child (I was unable to attend school for three solid months when I was in third grade), I can tell you from personal experience that air conditioning can literally be a life-saver for some asthma sufferers. I would have to sit in front of the air conditioner for extended periods of time because that was the only way that I could breathe without inducing another coughing attack, which could last as long as thirty minutes at a time.

Also, for people with severe arthritic problems, a swimming pool can be very beneficial. It would seem that if the person has had to have one or more joints replaced, it would seem to be pretty strong evidence that their arthritis inhibits them from exercising other than in a weightless environment.

[Alf]

Definitely tough situations I am sure, but I'll bet that the IRS is strict on allowing A/C expenses and home swimming pool medical deductions and cafeteria plan administrators have to be just as diligent. Remote car starters is just another example of how broad the range of possibilities is.

[Kirk Maldonado]

Actually, the IRS has expressly approved them, but the medical expense is limited to the cost in excess of what the improvement raised the value of the property. Thus, if the swimming pool cost $10,000 but only raised the value of the property by $8,000, the medical expense woudl be limited to $2,000.

My guess is that there is a discussion of this on Publication 502 ("Medical and Dental Expenses"), which can probably be found on the IRS website.

[Alf]

I don't know about you, but our Flex plan administrators don't get paid enough to do calculations like that. Definitely worth remembering this issue (whichever way the employer wants it to go) when restating/drafting the flex plan next time.

So, Kirk, what is your answer on the car starter?

[Guest mmclees]

Laura,

I just read this thread and found it quite typical of the type of expenses I receive from one employee with MS. However, they have not yet claimed the remote car starter and probably won't since they are no longer able to drive. Anyway, I'm thinking Alf is probably correct in his advice. The item doesn't seem to meet the "but for" test. But for the MS, would you still start your car? Obvious answer. As much as we want the items to be a medical necessity, they actually tend to be a greatly appreciated convenience.

[E as in ERISA]

But would you say "but for" the MS he would use a remote starter to do that? Probably not. I'm presuming that the reason for the starter is that he is sensitive to temperature. It's a problem to get in a really hot car that has been sitting in the sun or a really cold car in winter? This exacerbates the MS conditions? So what he is actually doing when he starts the car is to start the heat or A/C so that the temperature in the car is moderated before he gets in? Doesn't that meet the "but for" test? If he had a car without heat or A/C and he was asking to get that fixed, then that might have a dual purpose. I know someone with a completely different condition that caused low circulation in their extremeties and getting into a cold car was a tremendous problem because it would take hours to get them warmed up again. So I could see where a remote starter might be medically necessary.

Check this out. Heat sensitivity is a common problem and even a slight elevation in temperature is an issue. http://www.nationalmssociety.org/Sourcebook-Heat.asp

[E as in ERISA]

I don't want to sound like Tom Cruiser here, but... I'm picturing this poor guy with MS who has on occasion entered into a very hot car and had his vision blurred for about 20 minutes while he waits for the A/C to cool the car down and then for the condition to reverse. It is now stressful for him to go to his car on a hot day. He found this solution with the remote starter. But he can't get it reimbursed with his own money from the cafeteria plan. Meanwhile he sits near another employee who is all hopped up on pain killers or anxiety medication. But whose only real problem is that they don't exercise or eat like they should or they over analyze things and get themselves worked up so they have slightly more pain or anxiety than the next person. But they have no problem getting the meds reimbursed. Possibly through the regular health plan.

[Alf]

Ok, I think I see what bothers me about these. Is there another problem with this? Is the car used esclusively for obtaining treatment or care? If that is not relavant, can large-print books be reimbursed for the sight impared or wheelchair ramps or wide doorway modifications for those in wheelchairs? We don't think of our FSA as a source of funds for all of the living expenses or modifications necessary for functioning in society. Should we? Shouldn't the starter be necessary for obtaining medical care to be reimbursable?

[E as in ERISA]

No.

See page 6 of Publication 502 http://www.irs.gov/pub/irs-pdf/p502.pdf "Car" section. Says you can deduct special equipment needed by a person with a disability. The guy has a doctor's note saying this is medically necessary.

He's not asking to deduct the cost of the car or the A/C. Just a small inexpensive device that prevents him from losing his eyesight when he gets into a hot car.

And page 5 indicates that ramps and doorways expansions are generally fully deductible. And page 15 says that when something is purchased in special form to alleviate a physical defect, the excess over normal cost can be deducted. It gives Braille books as an example.

Oh, and I do understand that if this increases the value of the car that it would not be fully reimburseable. And this is something that any buyer might like not just a disabled person. So in that respect it's more like a pool than a wheelchair ramp. But this is a small convenience added to a depreciating asset. I think someone can make a judgment call and approve it.