Being a family caregiver may require you to provide financial support in addition to mental, emotional, and physical assistance. Financial expenses pertaining to your senior loved one’s care could be costly, but you may be able to offset the expenses at tax time. Before you file your taxes, you need to know which credits and deductions you are eligible for. Here are some tax credit tips that can make filing taxes easier for family caregivers.
1. Establish Dependency
Dependency is a tax credit most parents use to write off expenses related to childcare, but it can also apply to people who care for an elderly loved one. The amount that can be claimed for a qualifying expense will depend on your adjusted gross income as well as the type of expense and its cost. To qualify for this type of tax credit, you need to establish dependency. There are also other criteria you must meet to be considered a qualifying individual (or dependent), such as:
- Place of residence
- Reasons for care
If you need a break from your caregiving tasks to plan your taxes, consider hiring a professional caregiver. Families who need help caring for a senior loved one can turn to Home Care Assistance, a leading provider of Birmingham, Alabama, home care. Services available in our customizable care plans include meal prep, mental and social stimulation, assistance with personal hygiene tasks, and much more.
2. Write Off Medical Expenses
Never throw your receipts in the garbage, especially those pertaining to your loved one’s medical expenses. Some of these payments could qualify for a tax credit. Medical expenses generally have to be approved by the IRS. Your loved one will need to meet specific tests, such as citizenship, support, relationship, and income tests. If all the requirements are met, you could get a significant tax credit when writing off the medical expenses you incurred while caring for your loved one. You should always speak with a professional tax associate who can help you determine which medical expenses you can write off, the steps you need to take, and the amounts you can claim.
3. Make Improvements to Your Loved One’s Home
Keeping your loved one safe at all times should be a priority, even if it costs you money. You can deduct many of the expenses of safety-proofing your loved one’s home when you file your taxes. These improvements may include installing ramps inside and outside the home, adding handrails and grab bars in the bathrooms, and lowering the counters and shelves in the kitchen. If you have made energy-saving improvements to your loved one’s home, you could be eligible for a tax credit. Energy-efficient home improvements may include work done to the air conditioning and heating units, insulation projects, and window and door replacements.
Some caregivers may find it difficult to plan their taxes while managing daily duties. If you are the primary caregiver for a senior loved one in Birmingham, respite care is available when you need time away from your important caregiving duties. At Home Care Assistance, our respite caregivers are available 24 hours a day, 7 days a week to help your loved one manage everyday tasks in the comfort of home while you have the chance to take a much-needed break.
4. Keep Track of Your Mileage
Taking your loved one to the grocery store, doctor visits, community activities, and out-of-town visits with specialists can be deducted if these trips are deemed necessary to meet his or her medical needs. As long as your loved one qualifies as your dependent, you should be able to take the mileage deduction at tax time. The amount you can take per mile will depend on the current rules for that tax year. In addition to mileage, you may be eligible to deduct lodging expenses, as long as an overnight stay is required for medical purposes.
Consider hiring a professional caregiver if you need a break from your caregiving duties to tend to your taxes. Get in touch with Home Care Assistance to find out how a Birmingham, Alabama, caregiver can help your aging loved one live a longer, healthier, and happier life. Our caregivers are available 24/7, all of our senior care services come with a 100% satisfaction guarantee, and we never ask our clients to sign long-term contracts. To hire high-quality in-home care services for your aging loved one, call us at (205) 438-6925 today.