Tax breaks that reduce in-home senior care costs. There are a number of tax breaks that are offered to help a senior reduce their related costs. These include tax breaks when the senior is the employer. To determine which tax breaks you may qualify for, you must first determine who the employer is. This is generally the senior who is still living in their own home and needs in-home care, or the care may be for their spouse. In some circumstances, an adult child may be considered the employer if their parent receiving care passes the Qualifying Persons test. See IRS Publication 503
Families can save money by taking several senior caregiver tax credits and deductions. Caring for a loved one may make you eligible for deductions and tax credits. Here is an excellent article from AARP that outlines ways to reduce your tax burden. This article covers federal tax credits and deductions that apply to care giving costs. The average caregiver spends approximately $7,200 a year on medical, household and other costs associated with caring for a loved one.
What is and isn’t deductible?
Items and services that benefit the entire household are generally not deductible. Here is a sample of acceptable deductions:
- Assisted living costs when acquired for medical reasons
- Home and vehicle modifications as required for safety or mobility
- Physical Therapy
For a complete list of acceptable deductions, check out the IRS Publication 503 article
For additional information about Tax breaks that reduce in-home senior care costs, check out this resource at Care.com / HomePay.
English