Senior Group Presses For Caregiver Tax Credits
AARP finds nearly 80% of New York’s 2.5 million unpaid family caregivers pay a significant amount of their own money to help care for their loved one. The group is pushing for federal and state tax credits to help ease that growing burden.AARP surveyed caregivers in the spring of 2021 and found that unpaid family caregivers spend an average of $7,242 of their own money to care for an elderly or disabled relative.
The group’s New York Director of Government Affairs and Advocacy, David McNally, says the money goes to a wide range of needs.
“Over 50% of the money was being spent on housing,” said McNally, who said that includes paying for mortgage rent, or home modifications.
Others reported day-to-day expenses.
“Gas to drive someone to the doctor,” McNally said. “Certain foods that they need for their diet.”
He says those costs disproportionately fall on Black and Latino caregivers.
By age group, Generation X caregivers spent the most money at more than $8,500 in out of pocket expenses, while Generation Z and Millennials spent a larger share of their total household income on caregiving.
Caregivers also lose pay when they have to take time off from work or use paid family leave, which does not fully reimburse a person’s salary.
The problem is only expected to grow as the population ages.
AARP is asking Congress to approve a tax credit of up to $5,000 to help offset the caregivers’ costs. They still have to pay for the out-of-pocket expenses, but they would not have to pay taxes on those items or services or on the income they use to make the purchases.
“Unpaid family caregivers are the backbone of long-term care in our country,” McNally said. “They need more support. Unpaid family caregiving is exhausting physically, mentally, emotionally and frankly this report shows very clearly, financially too.”
The measure has bipartisan support, and is backed in New York by Democrats Tom Suozzi of Long Island and Brian Higgins in Western New York, and Republican Tom Reed from the Southern Tier.
A similar tax credit proposal in the New York state legislature is sponsored by Aging Committee chairs, Senator Rachel May and Assemblymember Ron Kim.
AARP is launching a media campaign to gain support for the proposals.
McNally says family caregivers can find more information about how to better plan financially on the group’s website.