Some of America's 40 million family caregivers would be eligible for up to a $3,000 tax credit to defray some of what they spend to assist their loved ones, under bipartisan measures introduced Tuesday in the U.S. Senate and House of Representatives.
"AARP believes we should support family caregivers as they take on the costs and responsibilities associated with caregiving,” David Certner, AARP's legislative counsel and director of legislative policy, says in a letter supporting the Credit for Caring Act. “They help make it possible for older adults and people with disabilities to live independently in their homes and communities where they want to be.”
Among the bill's tax credit eligibility requirements, a health care practitioner would have to certify that the loved one the caregiver is helping meets certain physical and cognitive needs. The caregiver would have to document expenses, and the credit would be 30 percent of the eligible expenses above $2,000. Caregivers would not have to live with the individual they are assisting and would not have to be caring for a legal dependent in order to be eligible for the tax credit.
The measures are being sponsored by Sens. Joni Ernst (R-Iowa), Michael Bennet (D-Colo.), Shelley Moore Capito (R-W.Va.), Elizabeth Warren (D-Mass.), Tammy Baldwin (D-Wis.), Angus King (I-Maine), Richard Blumenthal (D-Conn.), Jon Tester (D-Mont.) and Chris Coons (D-Del.) and Reps. Linda Sánchez (D-Calif.) and Tom Reed (R-N.Y.).
According to AARP researchers, about 40 million family caregivers provide an estimated $470 billion annually in unpaid care to their loved ones. Family caregivers spent nearly 20 percent of their income in 2016 providing care for an adult relative or friend for expenses such as adult day care, transportation, modifications to their loved ones’ homes and home care aides.
Helping a family member also often means the family caregiver has to either leave a job or cut back on how many hours they work. Family caregivers over age 50 who leave the workforce to care for a parent are estimated to lose, on average, more than $300,000 in lifetime income and benefits.
"Many family caregivers are using their own life savings, cutting back on personal spending, setting aside less for retirement, or taking out loans to help loved ones live independently,” says Nancy LeaMond, AARP chief advocacy and engagement officer. “The Credit for Caring Act would help with the financial struggles experienced by too many family caregivers, and we urge Congress to pass it.”
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