A bill to amend the Internal Revenue Code of 1986 to establish a credit for adult child caregivers.
Analysis under review: This bill has generated analysis that may be too generic or incomplete. Clause-level evidence remains available below.
Summary
What This Bill Does
This bill creates a new tax credit of up to $2,000 per year for Americans who care for aging family members in their homes. It aims to reduce the financial burden on family caregivers while encouraging in-home elder care as an alternative to nursing homes and assisted living facilities.
Who Benefits and How
Family caregivers who live with and provide at least 10 hours per week of care to parents, grandparents, or in-laws (age 55+) can claim up to $2,000 per qualified relative (maximum 2 relatives). Low-to-middle income families benefit most, as the credit phases out for individuals earning over $75,000 or couples earning over $150,000. Older adults benefit by being able to remain in family homes rather than institutional care settings.
Who Bears the Burden and How
The federal government bears the primary cost through reduced tax revenue. Healthcare providers face a new paperwork requirement - they must sign attestations confirming the care recipient's need for assistance. The IRS must administer and verify this new credit. Nursing homes and assisted living facilities may see reduced demand as families have more financial incentive to provide home-based care.
Key Provisions
- Creates $2,000 annual tax credit per "qualified relative" (maximum 2 relatives per year)
- Qualified relative must be age 55+, related as parent/grandparent/in-law, and unable to perform at least 1 activity of daily living plus 3 instrumental activities
- Caregiver must be U.S. citizen, age 18+ (or 16+ if emancipated), live with relative 6+ months, and provide 10+ hours/week of care
- Requires signed attestation from licensed healthcare provider confirming care needs
- Credit phases out: reduces by 1% for each dollar of income over $75,000 (single) or $150,000 (joint), fully phased out at $275,000/$350,000
- Coordinates with existing child and dependent care credit to prevent double-dipping
Evidence Chain:
This summary is generated from the full bill text using AI analysis. Expand "Detailed Analysis" below for identified beneficiaries/burden bearers.
At a Glance
What This Bill Does
Creates a new tax credit of up to $2,000 per year for individuals who provide in-home care to aging family members (age 55+) who require assistance with daily living activities.
Who Benefits
- Family caregivers of aging relatives
- Middle-income families with elderly dependents
- Older adults who can remain in family homes rather than nursing facilities
Who Bears Costs
- Federal government (reduced tax revenue)
- Healthcare providers (attestation paperwork)
- IRS (administration of new credit)
Key Policy Areas
Taxation, Healthcare, Elder Care, Family Support
Primary Purpose
Creates a new tax credit of up to $2,000 per year for individuals who provide in-home care to aging family members (age 55+) who require assistance with daily living activities.
Policy Domains
Legislative Strategy
"Provide tax incentives to encourage family-based elder care as an alternative to institutional care, reducing both family financial burden and Medicare/Medicaid costs"
Identified Gains
- Family caregivers of aging relatives
- Middle-income families with elderly dependents
- Older adults who can remain in family homes rather than nursing facilities
Identified Costs
- Federal government (reduced tax revenue)
- Healthcare providers (attestation paperwork)
- IRS (administration of new credit)
Sponsors
Peter Welch
D-VT | Primary Sponsor
Legislative Progress
In CommitteeMr. Welch (for himself and Mr. Scott of Florida) introduced …
Read twice and referred to the Committee on Finance.
Introduced in Senate
Stakeholder Effects
cui bono?How this legislation distributes effects. Mention counts reflect frequency, not effect magnitude.
Higher income families (AGI over $275,000), Low-to-middle income families (AGI under $75,000 single/$150,000 joint), Middle-income families with elderly dependents (AGI under $275,000)
Family caregivers of aging relatives living in multigenerational households, Family caregivers providing in-home elder care
Federal government (Treasury), IRS/Treasury Department
Healthcare providers required to provide attestation, Licensed healthcare providers (physicians, nurses)
Older adults (age 55+) requiring assistance with daily living activities
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
- "the_secretary"
- → Secretary of the Treasury
- "secretary_of_hhs"
- → Secretary of Health and Human Services
Key Definitions
Terms defined in this bill
A U.S. citizen age 18+ (or 16+ if emancipated) who lives with a qualified relative for 6+ months/year, provides 10+ hours/week of care, and obtains healthcare provider attestation
An individual age 55+ who is the taxpayer's parent, grandparent, or in-law, unable to perform at least 1 ADL and 3 IADLs requiring 10+ hours/week assistance for 180+ days
Includes meal planning/preparation, managing finances, shopping, household chores, communicating by phone/media, and traveling/participating in community
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology