Medical Tax Breaks For Caregivers

This article is accurate for returns filed through tax year 2017. Under the Tax Cuts and Jobs Act, some of the laws mentioned changed beginning in 2018. Learn more about the updated tax laws enacted under the Tax Cuts and Jobs Act here.

As a caregiver, you need all the breaks you can get—and that includes tax breaks. Below you’ll find a few tax breaks that might save you money, lower your tax bill, and ultimately relieve some of the emotional and financial stress that comes with caring for someone else.

Claiming a dependent

If you take care of your elderly parent who lives in your home, you may be able to claim your parent as a dependent, but these 7 criteria must be met. Claiming a dependent is one tax break that can lower your income that is subject to tax.

Choosing head of household

If you take care of your elderly parent who lives in your home, you can choose head of household as your filing status if

  • you’re not married;
  • you can claim an exemption for your parent; and
  • you were responsible for more than 50 percent of the cost of maintaining your home for your parent (that is, buying food, clothing, and other necessary items for your parent) during the year. Your parent, as your dependent, isn’t required to reside with you.

Deducting medical and dental expenses

If you itemize your deductions on Form 1040, Schedule A, you may be able to deduct the medical and dental expenses you paid for yourself, your spouse, and your dependents.

Remember, medical expenses must be more than 10 percent of your adjusted gross income, or AGI (7.5 percent of your AGI if you or your spouse is age 65 or older). Use Form 1040, Schedule A, to compute the amount deductible.

Back to our example: If you pay for part of your parent’s medical expenses, you may be able to deduct these medical expenses on your tax return if your parent was your dependent (see criteria above), but not if

  • he or she earned $4,050 in taxable income or more in 2017;
  • he or she filed jointly; or
  • you are claimed as a dependent on someone else’s tax return.

Figuring out what can or can’t be deducted

Click here for a list of what medical expenses can and can’t be deducted on your tax return. When you’re ready to e-file your tax return with TaxSlayer, we’ll ask you a series of questions to ensure you get every deduction to which you’re entitled. Our deduction finder is featured in every product—including Simply Free.

Other considerations

Let’s say you pay someone to care for your parent or relative while you work. In this case, you may be eligible for the child and dependent care credit on your tax return. Credits are especially helpful because they can really reduce your tax bill. See if you qualify for the child and dependent care credit.

For more details about medical and dental expenses, please see IRS Publication 502, Medical and Dental Expenses.