Caring for a parent can get expensive, and claiming them as a dependent on your tax return can provide some relief. Below we have listed the requirements you must meet to claim a parent as a dependent followed by the deduction and credit you may claim. There are likely more deductions and credits you qualify for, so we highly recommend meeting with a professional.If you do not meet one or both of the requirements to claim your parent as a dependent, you may be able to deduct medical expenses (see below).
To qualify as a dependent, your parent must not have earned more than the gross income limit set by the IRS for the specific tax year. This amount changes every year so be sure to look at the most updated numbers. Non-taxable income like Social Security does not count towards gross income.
Medical Expenses Deduction
Deduct your elderly parent's medical and dental expenses if you claim them as a dependent. You can deduct unreimbursed medical and dental expenses that exceed 10% of your adjusted gross income if you are itemizing your deductions.
If you cannot claim your parent as a dependent, you can still deduct medical expenses. The IRS lets you include the amount you pay for your parent’s medical care when you itemize your deductions. Allowable medical expenses include prescription drugs, dental care, hospital stays, long-term care services and supplemental Medicare premiums.
Dependent Care Credit
The Child and Dependent Care Credit is a non-refundable tax credit you may be eligible to claim if you paid another person to care for your elderly dependent while you were working. You can claim up to $3,000 per parent for in-home care expenses.
To be eligble for this credit, you must:
- Earn income during the year and claim your parent as your dependent
- Identify your care provider by entering their name, address, and employer identification number or social security number
- Be married filing jointly or unmarried; you cannot claim this credit if you are married filing separately
These are just the basics to claiming your parent as a dependent. There are likely a few less-common credits and deductions you qualify for, so we recommend meeting with a professional to get all the tax relief you deserve. If you are in the south Denver Metro Area, Denver Pro Tax would be happy to help. Contact us today!