21 Apr Credit for Caring Act proposed by Congress
In an effort to help family caregivers who take care of a family member (whether young or old) needing care at home and to give an incentive for the caregiver to work at least part-time (earned income in excess of $7,500 in a year), both the U.S. house and Senate have introduced a bill that would give a nonrefundable tax credit up to $3,000 (adjusted for inflation after year 2016 as a result of increased medical care costs) for eligible caregivers if they use their own money to help care for a family member who has long-term care needs (180 consecutive days part of which is in the tax year) or has severe cognitive impairment. It has been estimated that unpaid care would total $470 billion (if paid) each year in the U.S. The bill will help delay or prevent institutional care often paid by the government (i.e., Medicaid) for those older or disabled (including young children). The credit is phased out if the adjusted gross income of a married couple exceeds $150,000 or $75,000 if the taxpayer is single. Although the bill has bipartisan support, it was introduced by a democrat in an election year which reduces the chances for passage in year 2016.