Tax Breaks for Caregivers of Elderly Parents
Here at Preferred HealthStaff, we specialize in giving seniors the personalized care that they need. Our at home caregivers frequently work to support family members who are caring for the elderly people in their life. What we’ve learned over the years is that many of these kind people who take so much time out of their day to support their elderly parents have no idea that they can get a little bit of extra help from the IRS.
There are a few different tax breaks and deductions that you can qualify for if you’re taking care of your elderly parents. We know that every little bit of extra money can help when you’re caring for the seniors in your life. Here’s a look at some of the tax benefits you could qualify for.
Medical Expenses Deduction
If insurance didn’t cover the entire cost of a parent’s medical procedure or hospital stay and you paid out of pocket, you may be able to write off some of that cost. For the most part, people can deduct medical expenses that account for more than 7.5 percent of their adjusted gross income. As an example, if you make $40,000 per year, anything past the first $3,000 you spend on a parent’s medical bills could be deductible. This isn’t just a federal tax break. Your state could have its own rules, allowing you to write off even more of your expenses. To qualify, you need to have your parent listed as a dependent.
List Them as a Dependent
Speaking of, listing your parent has a dependent can confer more tax benefits than medical expense deductions. You may be able to claim a federal deduction of up to $4,050 if you list your elderly mother or father as a dependent. How much you can claim depends on your income, how much financial support you provide, and a few other factors. We recommend talking to your accountant to see how you can qualify, because this tax break can be a bit more complex than deducting medical expenses.
Child and Dependent Care Credit
If you’re paying for home care services like the ones we offer, you could also qualify for this tax break. If you’re paying someone to help out with your mother or father while you work or look for work, you could qualify for a credit of around twenty to thirty-five percent on $3,000 of adult at home care. This tax break requires that your parent live with you for a certain amount of time, and you need to have earned income in order to take advantage.
The Benefits Your Employer Offers
Some employers offer dependent care benefits like flexible spending accounts. In some cases these benefits are solely meant for children, but your employer might offer elder care benefits as well. You can put up to $5,000 of your pay in a flexible spending account without the need to pay taxes on it. You just need to make sure that your parent is listed as a dependent on your tax forms.
Caring for an elderly parent can be stressful, but we can help. Contact us at (866) 943-9791 and ask about our at home senior care today.