Tax Time 2011: If You're A Caregiver, You May Be Entitled To Claim Your Relative as a Dependent
If you are providing support to an aging family member, do some homework before filing your tax return.
You may be entitled to claim your relative as a dependent. This requires that:
- The individual's income was less than $3,650 in 2010. "Income" includes Social Security and pension benefits. Also, proceeds from investments or withdrawals from retirement savings plans.
- You paid more than 50% of your relative's support. He or she does not have to live with you. Support expenses include food, clothing, housing, and medical care. Also, transportation, recreation, and other essentials. If he or she lived with you, include fair rental value for your family member's share of the lodging.
Many relatives qualify. Your parents and siblings. Other family relatives, step relatives, and in-laws. Or anyone who lived with you all year.
If others paid some support expenses, a deduction is still possible. But only one person can claim it. And everyone who shared expenses must sign a multiple support agreement.
You may be able to deduct medical expenses.
- This includes expenses paid for yourself, your spouse, or a dependent relative. Or for a relative who would have qualified as a dependent but had too much income or filed a joint return.
- The expenses must add to more than 7.5% of your adjusted gross income (AGI). For example, if your AGI is $40,000, the first $3,000 of expenses doesn't count.
Look closely at what is considered medical expense. Some examples:
- Home improvements, such as grab bars and ramps
- Glasses, dental care, hearing aids
- Doctor's fees, lab fees, prescription drugs
- Insurance premiums, including Medicare
- Care facility or nursing home fees (if residency is the result of medical need)
- Personal care for disability or cognitive impairment
- Car mileage related to medical care (16.5 cents/mile)
Ask a tax specialist for more details.
For more caregiver tips and articles, go to www.keepmomathome.org . . . a publication of www.afamilymemberhomecare.com
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