Some Americans are eligible for a new federal tax credit worth $5,000–Are you one of them?
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The unsung heroes of healthcare, family caregivers, tirelessly devote their time, energy, and resources to support their loved ones.
It's a noble act of love, but it comes with a hefty price tag.
On average, family caregivers spend a staggering $7,200 annually out of their own pockets. But there's a glimmer of hope on the legislative horizon that could ease this financial burden.
Ana Tris, a 66-year-old former corporate professional from Miami, knows this struggle all too well.
After retiring early to care for her 91-year-old mother with Alzheimer's, Ana and her husband found themselves spending $80,000 last year on hired caregivers.
Their story is a common thread among the estimated 48 million caregivers across the US, who, according to AARP, provide about $600 billion worth of unpaid labor each year.
The dedication to caregiving often comes at the cost of personal sacrifice. Sixty-one percent of caregivers juggle their caregiving responsibilities with part-time or full-time jobs. The average caregiver in the US spent $7,242 in out-of-pocket costs in 2021, as per the AARP.
This dual role can lead to missed work, declined promotions, and a significant impact on their professional lives.
In response to this growing issue, a bipartisan group of US Senators and House Representatives has reintroduced the Credit for Caring Act.
This proposed legislation could provide a nonrefundable federal tax credit of up to $5,000 for eligible working family caregivers. The credit would cover 30% of qualified expenses exceeding $2,000, offering some relief from the financial strain.
The Credit for Caring Act aims to alleviate the costs associated with home care aides, adult day care, respite care, transportation, home modifications, and other supports.
You might be interested: Experts reveal secrets: How to transform the lives of the caregivers you love!
The bill aims to offset a portion of the more than $7,200 that families typically spend each year on out-of-pocket caregiving expenses. These costs can include home care aides, adult day care, respite care, transportation, home modifications, and other essential support services.
According to AARP, the family member receiving care does not have to live in the same household. However, to qualify for the tax credit, the caregiver must be the one covering the expenses—costs paid by the care recipient would not be eligible.
Nancy LeaMond, AARP's chief advocacy and engagement officer, emphasizes the bill's significance, noting its potential to alleviate the personal financial toll on families and reduce the impact on caregivers' work lives.
"This legislation is an attempt to give some relief to hard-working individuals who are trying to provide care for their loved ones and trying, at the same time, to continue to work and do what they need to do for themselves and their families," LeaMond said.
The Credit for Caring Act has been a decade-long effort, with AARP at the forefront of advocacy. The latest iteration of the bill is sponsored by Senators Shelley Moore Capito (R-West Virginia) and Michael Bennet (D-Colorado), and Representatives Mike Carey (R-Ohio) and Linda Sanchez (D-California), many of whom have personal caregiving experiences.
“Like so many Americans, I helped care for both of my parents as they battled Alzheimer’s at the end of their lives, and therefore, I understand the emotional and physical toll it can take on individuals and families," Capito said. "By passing this bill, we can help caregivers focus more on their loved ones and less on how much it will cost them.”
“Caring for both of my parents after they were diagnosed with Alzheimer's has given me a personal understanding of the emotional, physical, and financial challenges families face when caring for a loved one," said Sanchez. "Family caregivers – two-thirds of whom are women – often juggle work, family responsibilities, and the time and financial demands of caregiving. The Credit for Caring Act will ease some of these challenges by providing much-needed financial relief through a tax credit for home care and adult day care.”
Read next: Unlock hidden savings on your taxes with this guide to federal tax credits
A previous version of the bill, introduced last year with 98 co-sponsors, failed to advance out of committee.
However, AARP’s Nancy LeaMond noted that momentum has grown over time, as more lawmakers have seen the impact of caregiving firsthand—sometimes within their own families.
During the presidential campaign, both candidates acknowledged the significance of family caregivers. President Trump voiced support for a tax credit to assist those caring for loved ones, emphasizing that hardworking caregivers deserve financial relief, LeaMond said.
With bipartisan backing in Congress, advocates are hopeful that the tax credit will become law. Additionally, AARP reported that over 102 organizations have signed a letter endorsing the Credit for Caring Act.
Robert Egge, chief public policy officer of the Alzheimer’s Association, highlighted the bill’s importance, stating, "The Credit for Caring Act will provide real help to many families caring for their loved ones with Alzheimer’s."
Egge stressed the financial burden faced by dementia caregivers, explaining, "There is an urgent need to help with the staggering costs faced by our nation's dementia caregivers. While many of the over 11 million Alzheimer's caregivers value their essential role in maintaining the quality of life for their loved ones, caring for those living with dementia often takes a significant financial toll on families."
According to the Alzheimer’s Association, caregivers provided 18.4 billion hours of unpaid care in 2023, valued at nearly $350 billion.
A February AARP poll of 4,000 voters revealed strong public support for a caregiver tax credit, with 84% of respondents in favor.
For Ana Tris, a caregiver for her mother, the financial and emotional burden of caregiving has been overwhelming. Tris’ mother, Elvira, has lived with her and her husband for nine years.
Initially, Tris retired from her job at a luxury retailer to care for her mother full-time. However, after two years, she realized she needed additional support.
"Caregiving, especially without assistance, is very hard," Tris said.
Her mother’s condition, originally diagnosed as brain atrophy, has since progressed to Alzheimer’s. Even with paid caregivers, Tris still experiences stress.
Source: Caregiver Documentary / Youtube.
When a caregiver called in sick one Monday, Tris had a medical appointment of her own, leaving her husband—who is still employed—to stay home and care for his mother-in-law.
A caregiver tax credit would be a "welcome relief," Tris said, adding, "I do feel like it’s a beginning. Anything is helpful."
To qualify for the tax credit, a caregiver must have earned income of at least $7,500 per year, according to Megan O’Reilly, AARP’s vice president for government affairs on health care and family issues.
The credit phases out at higher income levels, disappearing entirely at $125,000 for individuals and $200,000 for joint filers.
Have you checked this out? Unclaimed stimulus checks await in 2025—check your eligibility now!
What are your thoughts on this proposal? Have you ever been a family caregiver? Share your experiences and thoughts in the comments below!
It's a noble act of love, but it comes with a hefty price tag.
On average, family caregivers spend a staggering $7,200 annually out of their own pockets. But there's a glimmer of hope on the legislative horizon that could ease this financial burden.
Ana Tris, a 66-year-old former corporate professional from Miami, knows this struggle all too well.
After retiring early to care for her 91-year-old mother with Alzheimer's, Ana and her husband found themselves spending $80,000 last year on hired caregivers.
Their story is a common thread among the estimated 48 million caregivers across the US, who, according to AARP, provide about $600 billion worth of unpaid labor each year.
The dedication to caregiving often comes at the cost of personal sacrifice. Sixty-one percent of caregivers juggle their caregiving responsibilities with part-time or full-time jobs. The average caregiver in the US spent $7,242 in out-of-pocket costs in 2021, as per the AARP.
Family caregivers in the US face significant financial burdens, with an average annual out-of-pocket cost of $7,242. Image source: Andrea Piacquadio / Pexels.
This dual role can lead to missed work, declined promotions, and a significant impact on their professional lives.
In response to this growing issue, a bipartisan group of US Senators and House Representatives has reintroduced the Credit for Caring Act.
This proposed legislation could provide a nonrefundable federal tax credit of up to $5,000 for eligible working family caregivers. The credit would cover 30% of qualified expenses exceeding $2,000, offering some relief from the financial strain.
The Credit for Caring Act aims to alleviate the costs associated with home care aides, adult day care, respite care, transportation, home modifications, and other supports.
You might be interested: Experts reveal secrets: How to transform the lives of the caregivers you love!
The bill aims to offset a portion of the more than $7,200 that families typically spend each year on out-of-pocket caregiving expenses. These costs can include home care aides, adult day care, respite care, transportation, home modifications, and other essential support services.
According to AARP, the family member receiving care does not have to live in the same household. However, to qualify for the tax credit, the caregiver must be the one covering the expenses—costs paid by the care recipient would not be eligible.
Nancy LeaMond, AARP's chief advocacy and engagement officer, emphasizes the bill's significance, noting its potential to alleviate the personal financial toll on families and reduce the impact on caregivers' work lives.
"This legislation is an attempt to give some relief to hard-working individuals who are trying to provide care for their loved ones and trying, at the same time, to continue to work and do what they need to do for themselves and their families," LeaMond said.
A bipartisan group of US Senators and House Representatives has reintroduced the Credit for Caring Act, which proposes a $5,000 nonrefundable tax credit for eligible working family caregivers. Image source: Judita Mikalkevičė / Pexels.
The Credit for Caring Act has been a decade-long effort, with AARP at the forefront of advocacy. The latest iteration of the bill is sponsored by Senators Shelley Moore Capito (R-West Virginia) and Michael Bennet (D-Colorado), and Representatives Mike Carey (R-Ohio) and Linda Sanchez (D-California), many of whom have personal caregiving experiences.
“Like so many Americans, I helped care for both of my parents as they battled Alzheimer’s at the end of their lives, and therefore, I understand the emotional and physical toll it can take on individuals and families," Capito said. "By passing this bill, we can help caregivers focus more on their loved ones and less on how much it will cost them.”
“Caring for both of my parents after they were diagnosed with Alzheimer's has given me a personal understanding of the emotional, physical, and financial challenges families face when caring for a loved one," said Sanchez. "Family caregivers – two-thirds of whom are women – often juggle work, family responsibilities, and the time and financial demands of caregiving. The Credit for Caring Act will ease some of these challenges by providing much-needed financial relief through a tax credit for home care and adult day care.”
Read next: Unlock hidden savings on your taxes with this guide to federal tax credits
A previous version of the bill, introduced last year with 98 co-sponsors, failed to advance out of committee.
However, AARP’s Nancy LeaMond noted that momentum has grown over time, as more lawmakers have seen the impact of caregiving firsthand—sometimes within their own families.
During the presidential campaign, both candidates acknowledged the significance of family caregivers. President Trump voiced support for a tax credit to assist those caring for loved ones, emphasizing that hardworking caregivers deserve financial relief, LeaMond said.
With bipartisan backing in Congress, advocates are hopeful that the tax credit will become law. Additionally, AARP reported that over 102 organizations have signed a letter endorsing the Credit for Caring Act.
The proposed tax credit aims to alleviate some financial pressures by covering 30% of qualified expenses above $2,000 for things like home care aides, adult day care, and other supports. Image source: JSME / Pexels.
Robert Egge, chief public policy officer of the Alzheimer’s Association, highlighted the bill’s importance, stating, "The Credit for Caring Act will provide real help to many families caring for their loved ones with Alzheimer’s."
Egge stressed the financial burden faced by dementia caregivers, explaining, "There is an urgent need to help with the staggering costs faced by our nation's dementia caregivers. While many of the over 11 million Alzheimer's caregivers value their essential role in maintaining the quality of life for their loved ones, caring for those living with dementia often takes a significant financial toll on families."
According to the Alzheimer’s Association, caregivers provided 18.4 billion hours of unpaid care in 2023, valued at nearly $350 billion.
A February AARP poll of 4,000 voters revealed strong public support for a caregiver tax credit, with 84% of respondents in favor.
For Ana Tris, a caregiver for her mother, the financial and emotional burden of caregiving has been overwhelming. Tris’ mother, Elvira, has lived with her and her husband for nine years.
Initially, Tris retired from her job at a luxury retailer to care for her mother full-time. However, after two years, she realized she needed additional support.
"Caregiving, especially without assistance, is very hard," Tris said.
Her mother’s condition, originally diagnosed as brain atrophy, has since progressed to Alzheimer’s. Even with paid caregivers, Tris still experiences stress.
Source: Caregiver Documentary / Youtube.
When a caregiver called in sick one Monday, Tris had a medical appointment of her own, leaving her husband—who is still employed—to stay home and care for his mother-in-law.
A caregiver tax credit would be a "welcome relief," Tris said, adding, "I do feel like it’s a beginning. Anything is helpful."
To qualify for the tax credit, a caregiver must have earned income of at least $7,500 per year, according to Megan O’Reilly, AARP’s vice president for government affairs on health care and family issues.
The credit phases out at higher income levels, disappearing entirely at $125,000 for individuals and $200,000 for joint filers.
Have you checked this out? Unclaimed stimulus checks await in 2025—check your eligibility now!
What are your thoughts on this proposal? Have you ever been a family caregiver? Share your experiences and thoughts in the comments below!
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