Tax Tips for Families with Special Needs
When a loved one has special needs, the cost of health care is usually a major concern, so be sure that you claim all the deductions to which you’re entitled.
Families should also be aware of the following credits:
- Dependent Care – Up to 35 percent of day care expenses incurred while the taxpayer is working or seeking employment.
- Earned Income Tax Credit – For low- to moderate-income families with children under 19 (up to age 23, if children are full-time students). This also applies to adults with disabilities who work.
- Elderly Disabled – For individuals 65 or older who are filing income taxes.
- Disability income from a previous employer’s benefit plan – Eligibility is dependent upon income level.
Perhaps the most important tax decision occurs long before April 15, when a special needs trust (SNT) is first established for a child with disabilities.
Tax planning is clearly a complex matter for families with special needs and regulations may shift from year to year. Obtaining qualified advice can prevent costly mistakes.