Yes! You Can Deduct Home Care Costs from Your Taxes…
It's fast approaching that time of year again…tax season. We are often asked about the deductibility of home care on your federal taxes. So we wanted to provide some key information…
Know How a Relative Qualifies as a "Dependent" on Your Return
How a relative qualifies as a "dependent" is based on two qualifications. First qualification is their yearly income. For example in 2014, their total income (not including nontaxable Social Security or disability payments) has to be less than $3,950. The second qualification was whether or not a caregiver supplied more than 50% of the relative's support. If these 2 requirements are met, you will be able to take the standard deduction for each dependent.
Know When You can Claim a Tax Benefit for a Dependent's Medical Expenses
Again, this is based on two qualifications: first, you must supply more than 50% of their support. Second, your total medical costs must represent more than 10% of your adjusted gross income. One slight difference to note is that if your dependent is 65 or older, the percentage drops from 10% to 7.5%*.
Know What Other Expenses You can Claim
You would be surprised at what expenses you can claim when taking care of a dependent. The following list can make sure you squeeze every penny for your tax refund.
Other Expenses to Claim: