Tax Breaks for Parent Care
According to some studies, nearly 20% of adult children provide some amount of financial assistance to their aging parents. If your parent's income is less than $3,500 per year (excluding Social Security), and you provide more than 50% of their support (including Social Security and the fair rental income of their home), you can write off care giving expenses. If that's the case, you may be able to claim your parent as a dependent and get a tax break on medical and other expenses. And if someone cares for your live-in parent while you work, you can pay up to $5,000 of those fees using pre-tax dollars if your employer offers a dependent-care flexible spending account − if they don't, you can use the dependent-care credit, earning a credit of between 20% and 35% on the first $3,500 of expenses.