How Much Do You Get Back for Claiming a Disabled Person?

Supporting a disabled individual can bring about various tax advantages, potentially reducing your overall tax liability. These benefits are designed to help offset some of the financial responsibilities associated with providing care and support.

Defining a Qualifying Disabled Person for Tax Benefits

The Internal Revenue Service (IRS) has specific criteria for an individual to be considered “disabled” for tax purposes. A person has a permanent and total disability if they cannot engage in any substantial gainful activity due to a physical or mental condition. This condition must be expected to last continuously for 12 months or more, or result in death.

Substantial gainful activity refers to performing significant duties for pay or profit, or in work done for such purposes. Full-time or part-time work in a competitive environment for at least minimum wage indicates an ability to engage in substantial gainful activity. Activities related to self-care or household maintenance are not considered substantial gainful activity for this definition.

To establish this status, a qualified physician must certify the condition. This certification should state that the disability has lasted or is expected to last for the required duration, or lead to death.

Direct Tax Credits for Supporting a Disabled Person

Tax credits directly reduce the amount of tax you owe, providing a dollar-for-dollar reduction in your tax liability. One credit for those supporting a disabled person who is not a qualifying child for the Child Tax Credit is the Credit for Other Dependents. This credit is a non-refundable amount of up to $500 per qualifying dependent.

To claim the Credit for Other Dependents, the individual must be your dependent, have a Social Security number or Individual Taxpayer Identification Number, and not be eligible for the Child Tax Credit. This includes dependents of any age, including those 18 or older, or qualifying relatives who rely on you for support. The credit begins to phase out for taxpayers with incomes above $200,000, or $400,000 for married couples filing jointly.

For a disabled qualifying child, the Child Tax Credit may apply. This credit can be worth up to $2,000 per qualifying child for the 2024 tax year, with a portion potentially refundable as the Additional Child Tax Credit. To be a qualifying child for this credit, the dependent must be under 17 at the end of the tax year, have a valid Social Security number, live with you for more than half the year, and not provide more than half of their own support. The refundable portion, the Additional Child Tax Credit, can be up to $1,700 per qualifying child for the 2024 and 2025 tax years, and requires earned income above a certain threshold, such as $2,500.

Deducting Medical Expenses for a Disabled Person

Taxpayers may be able to deduct qualifying medical expenses paid for themselves, their spouse, and dependents, including a disabled person. This deduction is claimed as an itemized deduction on Schedule A (Form 1040) and applies to expenses not reimbursed by insurance or other means. The deductible amount is limited to the portion of expenses that exceeds 7.5% of your Adjusted Gross Income (AGI).

Qualifying medical expenses cover costs for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for treatments affecting any body function. For disabled individuals, this can include specialized equipment, certain home modifications to accommodate medical needs, payments for care services, and therapies. Medical services from physicians, surgeons, dentists, and other licensed practitioners are also included.

Track all unreimbursed medical expenses throughout the year. For instance, if your AGI is $50,000, only medical expenses exceeding $3,750 (7.5% of $50,000) would be deductible. This deduction reduces your taxable income, which differs from a tax credit that directly reduces your tax liability. Taxpayers must choose to itemize deductions rather than taking the standard deduction to claim medical expenses.

Other Tax Advantages and Filing Status Considerations

Supporting a disabled person can influence your tax situation beyond direct credits and deductions, particularly concerning your filing status. One filing status is Head of Household, which offers lower tax rates and a higher standard deduction compared to filing as Single. To qualify for Head of Household status, you must be unmarried or considered unmarried on the last day of the tax year.

You must also pay more than half the cost of maintaining a home for the year, and a qualifying person must live with you in that home for more than half the year. While a qualifying child or other relative needs to live with you, a dependent parent does not need to live in your home to qualify you for Head of Household status, provided you pay more than half the cost of maintaining their home.

Claiming These Benefits on Your Tax Return

To claim tax benefits for supporting a disabled person, accurate reporting and documentation are needed. You will use Form 1040, U.S. Individual Income Tax Return. For tax credits like the Child Tax Credit and the Credit for Other Dependents, you will need to attach Schedule 8812, Credits for Qualifying Children and Other Dependents, to your Form 1040.

Medical expense deductions are reported on Schedule A, Itemized Deductions, which is also attached to Form 1040. Have the Social Security number or Individual Taxpayer Identification Number for each dependent you claim. Maintaining thorough records, including medical bills, proof of support, and a physician’s statement certifying disability, will substantiate your claims if the IRS requests verification.