The Credit for Caring Act creates a new federal tax credit to help working Americans who provide care for family members or relatives with long-term care needs. Eligible caregivers—individuals earning at least $7,500 annually—can claim a credit equal to 30 percent of qualifying care expenses that exceed $2,000 per year, up to a maximum credit of $5,000 (adjusted annually for inflation). Qualified expenses cover a broad range of costs including direct care worker wages, home modifications, assistive technologies, respite care, caregiver counseling, lost wages due to unpaid caregiving time, and travel related to providing care. The credit phases out for higher-income taxpayers, reducing by $100 for each $1,000 (or fraction thereof) above $150,000 for joint filers or $75,000 for others, with those thresholds also indexed for inflation. The bill takes effect for tax years beginning after December 31, 2024, and requires that individuals receiving care be certified by a licensed health care practitioner as having long-term care needs lasting at least 180 consecutive days.
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