The Internal Revenue Service
allows family caregivers to claim anyone related by blood,
marriage, adoption or even friends as dependents — if both
parties meet the IRS requirements. If so, the caregiver can
claim the dependent deduction on federal taxes. Bonus for the
single taxpayer: Adding a dependent allows you to claim the
deduction and bumps you up to head of household — even if your
relative lives in a different house. The change in status means
your 2017 personal deduction jumps from $6,350 to $9,350.
Your loved one must be a legal resident of the United
States, Mexico or Canada.
Your loved one’s taxable income
cannot be greater than that year’s cutoff amount ($4,050 in
Taxable income includes
profits from investments, dividends, capital gains,
rental income, interest, withdrawals for regular IRAs, 401Ks and
other retirement accounts, earned income including wages,
certain royalties, honoraria, severance and sheltered work shop
Tax-exempt income includes
nontaxable pensions, Social Security, if income is under $25,000
for a single tax payer or $32,000 if you file jointly,
disability payments from the Veterans Affairs, Supplemental
Security Income, unemployment benefits, Supplemental Nutrition
Assistance Program benefits and small cash gifts.
for more than 50 percent of your loved one’s annual living
expenses. This can include: food, clothing, lodging, medical and
dental care, recreation, transportation and other necessities.
Two or more people can split their relative’s expenses, but
only one person can claim the dependent. The IRS suggests taking
turns taking the deduction. Everyone who contributes more than
10 percent must file a Multiple Support Declaration with the IRS
waiving the right to claim your mutual loved one as a dependent.
Your parent, if married, doesn't file a joint return or
files a joint return only to claim an income tax refund.
You may claim a friend, honorary auntie or unrelated beloved as
a dependent. The same rules apply plus one more: The care
recipient must have lived with you for at least six months of
Continue - Tips for Caregivers: What the IRS Allows
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