Nearly every one of us knows someone who is helping care for an aging loved one. And while the love for those closest to us is priceless, the actual cost is anything but cheap. According to a recent article in the McPherson Sentinel, the average cost of a Bay Area caregiver is $25-35/hour; medical wipes are $7 a package; retrofitting a home for senior safety can cost tens of thousands of dollars. AARP conducted a study in 2016 that determined the average family caregiver spends nearly $7,000 per year caring for a family member. The good news is that these figures are not falling on deaf ears.
While federal bills that would have created a tax credit of up to $3,000 for family caregivers never made it out of Congress last year, 8 states are already considering legislation that would provide tax credits to offset such above-mentioned expenses for those caring for loved ones. State Assemblyman Jim Patterson (Fresno) is the author of a California bill that would provide family caregivers a tax credit of up to $5,000 annually. According to the recent article, “Patterson’s bill would provide up to a $5,000 state income tax credit to family caregivers for five years, starting in tax year 2020. They would be reimbursed for 50 percent of eligible expenses, such as retrofitting a home, hiring an aide and leasing or buying specialty equipment. The credit would be available to individuals who make up to $170,000 a year, or joint income tax filers who make up to $250,000.”
Efforts of the like in Arizona, Mississippi and Virginia have failed, while New Jersey has approved a state income tax credit in 2017 specifically for those caring for wounded veterans. The current California measure faces competition from funding boosts to education, health care, housing and dozens of other programs. Advocates of the bill believe that the tax credit is a financially sound option to keeping loved ones at home, as opposed to relying on more expensive government services.
The progress of this bill is one that we look forward to following as we consider solutions to support aging Americans, especially amidst the reality of living in one of the nation’s most expensive areas. Regardless of location, 40 million caregivers across the country could benefit tremendously from financial subsidies, workplace flexibility and respite relief. Learn more about what AARP is doing to champion these needs HERE.
*Please note that this article is for informational purposes only and is not intended to serve nor replace professional tax or financial guidance. In addition, the sharing of this proposed legislation is not an endorsement of any political party nor affiliation.
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Bobbi Decker & Associates fully supports the principles of the Fair Housing Act and the Equal Opportunity Act. For more information, please visit: http://portal.hud.gov/