If you’re still trying to get 2017 taxes filed for yourself, your parents, or other loved ones, you might want to consider taking advantage of several tax breaks for seniors. Because tax laws vary by state, you should consult with a professional accountant or attorney about specifics. However, many of the things you do on a daily basis could mean benefits for you. Here are a few to think about.
● Medical and dental expenses: Health insurance premiums, prescription costs, and out-of-pocket expenses are among the top tax breaks for seniors.
● Home sales: If you sell your home, such as in the case of moving into senior living, the profit you make from the sale might not be taxed, especially if you have equity in your home. Ask your accountant for specifics regarding your benefits regarding home sales.
● Long-term care: Long-term care services for assisted living or memory care may be tax-deductible as well. In order for these expenses to be tax deductible, the resident must be unable to perform two or more daily living activities such as bathing and dressing, or require supervision due to dementia.
● Independent living: Residents may be eligible for certain property tax credits on their state returns. To see if you qualify and what you are eligible for, be sure to inform your accountant or attorney that you reside in an independent living community.
● Retirement plan contributions: You can still reap the same benefits of contributing to a retirement plan, such as paying taxes ahead of time in your 401k in order to avoid paying them later when you withdraw money from the account.
● Investment expenses: For seniors, profits from investments are taxed at a lower amount than normal income, and they are not taxed for Social Security or Medicare.
● Business expenses: If you own a business or are working part-time, the costs for business travel and equipment can be deducted.
● Caregiver credits: If you are a child of or otherwise caring for an aging adult, you may be eligible for deductions for expenses related to their care. You also may be eligible for an elderly care tax credit.
You also can continue to benefit from general tax breaks, such as those that apply for charitable contributions. Consult with a tax professional to learn more about the specific benefits that you or your parent can gain this tax season.