A bill introduced in the House of Representatives would extend the dependent care credit to include expenses related to caring for parents and grandparents who do not live with the taxpayer.
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The bill was introduced in response to the rising number of people providing financial assistance to a parent or grandparent. According to the bill, ÛÏthe proportion of adult children providing personal care or financial assistance to a parent has more than tripled during the past 15 years.Û
In order to be listed as a dependent, the adult must be physically or mentally incapable of caring for himself and be the taxpayerÛªs mother or father, or an ancestor of the taxpayerÛªs mother or father.åÊ If passed, the tax credit would apply to all taxable years beginning January 1, 2011.
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Read the full bill: Elder Care Tax Credit Act of 2012.