Important Tax Breaks for the Elderly

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While many elderly people do not need to file a tax refund if they only receive Social Security benefits, seniors can qualify for many tax breaks to reduce income taxes and receive a refund. Here, North Houston senior care agency Home Care Assistance highlights some of the most important tax deductions for the elderly. 

1. Medical Expenses

Medical expenses are often one of the largest expenses for the elderly, and many are tax-deductible. If your senior loved one itemizes his or her deductions, they can deduct medical expenses up to a limit. Under current rules, anyone aged 65 and older can deduct any qualifying medical and dental expenses in excess of the taxpayer’s adjusted gross income. Qualifying expenses include nursing home care, prescriptions, long-term care insurance premiums, health insurance premiums, Medicare premiums, and most out-of-pocket medical costs.

2. Charitable Contributions

Anyone can deduct charitable donations. Seniors who are 70 1/2 or older are required to take a minimum distribution from retirement accounts, but it is possible to roll the distribution over directly to a charity, in which case the distribution is not counted as income. This lowers taxable income and AGI.

3. Higher Standard Deduction

Seniors are entitled to a standard higher deduction if one or both spouses are at least 65. For a single senior, the standard deduction is at least $7,850 compared to $6,300 for younger taxpayers. For a qualifying widow or widower, the standard deduction is $13,850 to $17,600–depending on age and vision–compared to the $12,600 standard deduction for younger taxpayers.

4. Disability Tax Credit

The disabled and elderly can receive a tax credit in certain cases. To claim the credit, total income cannot exceed a certain threshold. For seniors filing as single, a qualifying widow/widower, or head of household, the AGI must be less than $17,500 and non-taxable pension and Social Security income cannot exceed $5,000.

5. Dependent Deductions

Seniors who are supporting children, grandchildren, or other dependents can qualify for additional tax breaks. These tax breaks include the child credit of $1,000 per dependent, dependent care credits, and dependency exemptions.

Home Care Assistance is a trusted provider of senior home care, offering North Houston dementia care, Alzheimer’s care, and hourly and live-in care. We ensure seniors, regardless of cognitive or physical ability, have the help they need to remain safe and comfortable in the familiar surroundings of home. For more information, call 832-412-1345 and schedule a free in-home consultation with a friendly Care Manager.