You've been covering your mom's rent gap and her pharmacy bills all year, and your brother chips in when he can. At tax time you wonder: can either of you claim her? Does it matter that she lives in her own apartment? And can any of her medical bills help your return?
The answers come from a handful of IRS rules that are clearer than they look. This guide walks through them in plain language, using IRS publications as the source. We don't list dollar thresholds here because the IRS adjusts many of them every year. Check the current publication for the year you're filing, and talk with a tax professional or a free IRS-sponsored tax clinic about your situation6.
The four tests for a qualifying relative
A parent is usually claimed as a qualifying relative. The IRS says four tests must be met1:
- Not a qualifying child. Your parent can't be anyone's qualifying child. This rarely affects older parents1.
- Member of household or relationship. Your parent either lives with you all year or is related to you in a listed way. Parents and grandparents are on that list, so your parent doesn't have to live with you1.
- Gross income. Your parent's gross income for the year must be under a limit the IRS sets each year. Gross income means taxable income, so nontaxable income doesn't count toward it1.
- Support. You generally must provide more than half of your parent's total support for the year1.
There is no age test for a qualifying relative1. Your parent also generally must be a U.S. citizen, U.S. national or resident of the United States, Canada or Mexico, and can't file a joint return except in limited cases7. The IRS's interactive tool, Whom May I Claim as a Dependent?, walks through these questions7.
The gross income test
This is the test that rules out many parents. Gross income includes taxable income such as pensions, IRA withdrawals, interest, dividends and rental receipts1. Social Security benefits are often partly or fully nontaxable for people with modest income, and nontaxable amounts aren't part of gross income for this test18. So a parent who lives mainly on Social Security may pass the test even though the monthly benefit feels like real income. Look up the current-year limit in Publication 501 before you decide.
The support test
To pass, you must provide more than half of your parent's total support for the year1. Total support includes lodging, food, clothing, medical and dental care, transportation, and similar necessities1. If your parent lives in their own home, the fair rental value of that home counts as support they provide for themselves1. If they live with you rent free, the fair rental value of the space counts as support you provide1.
Your parent's own money counts as support only if they actually spend it on support. Social Security benefits your parent uses for their own support count as support they provided1. Money they save isn't support. Support from the state, such as Medicaid or other welfare benefits, counts as support provided by the state, not by you1.
- Add up everything spent on your parent during the year, from every source.
- List what you paid, with receipts, bank records and canceled checks.
- Include a fair rental value if your parent lives with you.
- Compare your share with the total to see if it's more than half.
When siblings share support
Often no single child pays more than half. If two or more people who could each claim the parent together provide more than half the support, they can agree that one of them claims the parent. That person must have provided more than 10% of the support, and each of the others who contributed more than 10% signs a statement agreeing not to claim the parent1. The person claiming the parent files Form 2120, Multiple Support Declaration2.
Families often rotate the claim from year to year. Put the plan in writing so everyone knows who claims your parent and who gathers the receipts. See caregiver agreements with family and long-distance caregiving.
Head of household filing status
If you're unmarried and your parent is your dependent, you may be able to file as head of household. Usually the qualifying person must live with you, but a dependent parent doesn't have to: you qualify if you pay more than half the cost of keeping up a home that was your parent's main home for the year1. That can include paying for your parent's own home or apartment, or a home for the aged1.
Head of household status usually means a lower tax rate and a higher standard deduction than filing single1.
The credit for other dependents
If you claim your parent as a dependent, you may qualify for the credit for other dependents. The IRS lists dependent parents among the people it covers3. The credit begins to phase out at higher incomes, and your parent must be a U.S. citizen, national or resident alien3. The credit amount and phase-out levels are set in law and can change, so check the current IRS page.
Deducting your parent's medical expenses
If you itemize, you can include medical expenses you paid for your dependent4. Publication 502 also lets you include medical expenses for a parent who would have been your dependent except that their gross income was too high or they filed a joint return4. Only the part of total medical expenses above 7.5% of your adjusted gross income is deductible49.
Medical expenses can include doctor and hospital bills, prescriptions, dental care, hearing aids, insurance premiums and long-term care services4. Nursing home costs, including meals and lodging, count when a principal reason for being there is medical care4. Qualified long-term care services for a chronically ill person, provided under a plan of care from a licensed health care practitioner, can also count, which may include some assisted living and memory care costs4. See is memory care tax deductible.
The credit for dependent care while you work
If you pay for care for your parent so that you can work or look for work, you may qualify for the child and dependent care credit510. For an adult, the qualifying person must be physically or mentally unable to care for themselves and must have lived with you for more than half the year. They must be your dependent, or would be except for certain income or filing reasons5. You must have earned income5.
Adult day care and in-home care while you're at work can qualify. You file Form 2441 with your return5. If your employer offers a dependent care flexible spending account, it may cover the same kinds of expenses, but you can't use the same dollars for both5. See adult day care.
If you pay a family caregiver
If you pay a relative or another person to care for your parent in your home or theirs, you may have household employer duties, such as withholding and paying Social Security and Medicare taxes, once wages pass a yearly threshold5. Care payments to your own child under 19 or to your spouse don't qualify for the dependent care credit5. See how to get paid to care for an elderly parent.
A worked example
Maria's father, Luis, lives alone in a rented apartment. His only income is Social Security, and none of it is taxable, so he passes the gross income test. Luis spends his benefits on food and utilities. Maria pays his rent and most of his prescriptions, and her brother Carlos pays for his phone and some groceries.
To check the support test, Maria adds up every dollar spent on Luis that year from all three of them, including the rent. Her share is less than half, but together Maria and Carlos pay more than half. They sign a multiple support agreement, and Maria claims Luis, filing Form 21202. Because Maria is single and pays more than half the cost of keeping up her father's apartment, she may also qualify as head of household even though he doesn't live with her1. If she itemizes, the prescriptions she paid for count toward her medical expenses4. Next year, if Carlos pays more, they can switch.
Every family's facts differ, so treat this as an illustration, not advice.
Keeping records through the year
Tax time is much easier if you track support as you go. Keep a simple spreadsheet or folder with what each person paid, the date and what it was for. Save receipts for medical bills and care, records of rent or housing costs, and your parent's year-end income statements, such as the Social Security benefit statement and any pension or IRA forms. If you have power of attorney, keep your parent's money and your own clearly separate. See power of attorney for an elderly parent and Social Security representative payee.
Common mistakes to avoid
- Two siblings both claiming the parent. Only one person can claim a dependent each year. A signed multiple support agreement prevents conflicts1.
- Counting the parent's own money as yours. Money paid from your parent's accounts is their support, even if you write the check as their agent.
- Forgetting fair rental value. Lodging is often the largest support item, and it counts for whoever provides it1.
- Ignoring the 7.5% floor. Medical costs only help if total expenses pass the floor and you itemize4.
- Missing the dependent care credit. If your parent lives with you and you pay for care so you can work, check Publication 5035.
A parent's Medicaid eligibility doesn't depend on your tax return, but money you give them can count as their income for benefits. See managing an elderly parent's finances.
Getting help
The IRS offers free tax help through Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) for people who qualify6. Both you and your parent may benefit, since your parent may need to file a return of their own. Bring a list of everything you paid, your parent's income statements and any signed Form 2120. For complex situations, such as a parent with significant assets or a family trust, talk with a tax professional.
