Can You Deduct Funeral Expenses From Your Taxes?

Funeral expenses are generally not deductible on an individual’s personal income tax return. However, they can be deductible for federal estate tax purposes under specific conditions. This distinction is important for those managing a deceased person’s financial affairs, as it impacts how tax authorities treat these costs. Understanding these rules clarifies the limited circumstances under which funeral expenses offer a tax benefit.

Deductibility for Federal Estate Tax Purposes

Funeral expenses can be deducted from a deceased person’s gross estate for federal estate tax purposes. This deduction applies only if the estate’s value exceeds the federal estate tax exemption amount for the year of death. For 2025, this exemption is $13.99 million, meaning only estates valued above this threshold are potentially subject to federal estate tax.

The federal estate tax is imposed on the transfer of a deceased person’s assets to their heirs. It is distinct from income tax. Therefore, the deductibility of funeral expenses in this context is a consideration for large estates, not for typical individual income tax filers.

Qualifying Funeral Expenses

The IRS outlines specific types of funeral expenses deductible for estate tax purposes. These include reasonable and customary costs directly associated with the funeral and burial. Examples are funeral home charges like embalming, cremation, or funeral services, and the cost of a burial plot or cremation niche.

Other qualifying expenses include the grave marker or headstone, transportation of the body, and fees for clergy or officiants. However, certain costs are not deductible. These include travel expenses for family members, the cost of a wake or reception (unless part of the customary service), and excessive floral arrangements. Additionally, any funeral expenses reimbursed by sources such as life insurance policies, the Department of Veterans Affairs (VA), or Social Security Administration (SSA) benefits are not eligible for deduction.

Claiming the Estate Tax Deduction

The deduction for qualifying funeral expenses is claimed on IRS Form 706, the “United States Estate (and Generation-Skipping Transfer) Tax Return.” The executor or personal representative of the deceased person’s estate is responsible for filing this form. Form 706 is necessary when the gross estate, combined with adjusted taxable gifts, exceeds the federal exemption amount.

To claim the deduction, the executor must itemize all eligible funeral expenses on Schedule J of Form 706. Accurate documentation, including receipts and detailed records of all costs, is important. Form 706 must generally be filed within nine months after the date of death, though an automatic six-month extension can be requested by filing Form 4768.

Why Funeral Expenses Are Not Income Tax Deductible

Funeral expenses are not deductible on an individual’s personal income tax return (Form 1040). The IRS classifies these costs as personal expenses, which are not eligible for tax deductions. This applies whether the expenses are paid by the deceased’s family or from the deceased person’s final income.

A common misunderstanding is that funeral expenses qualify as medical expense deductions. However, funeral costs are not considered medical expenses for income tax purposes. While certain medical expenses incurred before death might be deductible on the decedent’s final income tax return or the estate’s income tax return, funeral-related costs do not fall into this category.