Tax credits possible for family caregivers


By R.R. Fletcher, Contributing Writer

Three bills before the Massachusetts state legislature provide tax credits for incurred costs by family caregivers.
Three bills before the Massachusetts state legislature provide tax credits for incurred costs by family caregivers.

BOSTON – Family caregivers are a vital but largely unrecognized component of long-term health care. However, that may be changing. Currently, over 15 acts sit before the 192nd General Court of the Commonwealth of Massachusetts addressing caregiver issues and needs. One set of legislation proposes tangible relief.

The bills H.3043 and S.788, An Act to Establish the Family Caregiving Tax Creditsponsored by Sen. Jason M. Lewis (D-5th-Middlesex) and Rep. David Rogers (D-24th Middlesex), provide tax credits for incurred caregiving costs. A third, Bill H.2979, An Act Establishing the Family Caregiver Tax Credit, sponsored by Rep. Carolyn C. Dykema (D-8th-Middlesex) and Rep. Michelle M. DuBois (D-10th-Plymouth), allows a more generous tax credit.

Also of note, similar bills sit before the United States Congress―S.1670/H.R.3321, Credit for Caring Act 2021, which provide a federal tax credit for eligible working family caregivers. These bills are sponsored by Senators Joni Ernst (R-IA) and Elizabeth Warren (D-MA) and in the House by Representative Linda Sánchez (D-CA).


Family caregiving in America

Over 48 million caregivers in the United States provide unpaid care to loved ones, according to the National Alliance for Caregiving. At the same time, the Centers for Disease Control estimates that 43 percent of adults serve as unpaid caregivers. In Massachusetts, more than 840,000 residents provide 786 million hours of informal care annually and cost Massachusetts employers over $982 million in 2017 through increased turnover, absenteeism, and presenteeism. And even more startling, according to AARP, if family caregivers aged 50 and over have access to workplace support, U.S. Gross Domestic Product could grow by an additional $1.7 trillion (5.5%) by 2030.

While most caregivers assist with basic activities such as mobility, eating, and dressing, many perform more complex tasks, including maintaining medication schedules, providing wound care, and operating medical equipment. Caregivers also coordinate healthcare schedules, assist with the household, including finances, and encourage socialization.

But it’s not just physical care. Research shows 8 in 10 caregivers face regular out-of-pocket costs, with the highest burden falling on younger and Latino and Black caregivers. AARP found that family caregivers face a significant financial strain―$7,242 annually―over 26% of the caregiver’s income, and working caregivers spend over $10,525 annually in unreimbursed costs. 

Caregivers are also experiencing indirect financial setbacks. Over 47 percent experienced at least one negative personal impact―cutting personal health care spending, accessing personal savings, or reducing retirement contributions.


What is ‘An Act to Establish the Family Caregiving Tax Credit’?

These bills would provide tax credits for certain defined expenses incurred by family caregivers for the care and support of a loved one. Proposed tax credits vary―establishing income and state residency requirements and tax credit maximums ranging from $1500 to $3000 annually.

The bills, H.3043/S.788, build upon the standard definition of caregiving, “Activities of Daily Living (ADL).” And while not perfect, they at least acknowledge the complicated nature of caregiving by defining “Eligible Family Members” as related by “blood or marriage including in-laws.”


More than just a tax credit

Tax credits are a positive first step in acknowledging the strain on familial caregivers. However, as more and more bills address caregiver issues, there is also a growing message―the need to recognize the irreplaceable role that family caregivers have in the ‘Continuum of Care.’ 

Raising awareness is at the heart of organizations like the fledgling Massachusetts-based start-up ARCHANGELS. Collaborating with Blue Cross/Blue Shield of Massachusetts and the Mass Caregiving Initiative, ARCHANGELS launched the Any Care Counts campaign, designed to increase recognition and support of unpaid caregivers in the Commonwealth. 



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