The Internal Revenue Service (IRS) offers tax help for people with disabilities, helping them deal with their personal financial situations. These supports help them pay less money because they have physical or mental limitations. These benefits are designed to provide additional support to disabled people and their families, recognizing the special challenges they face in their daily lives.
Whether you’re legally blind, a senior citizen, or have a child with a disability, there’s a significant chance you could benefit from these tax relief programs offered by the IRS. Discover if you’re losing some alternatives that could help you catch some fresh air when paying your taxes.
Standard Deductions for the Elderly and Visually Impaired
From tax credits and deductions to specialized forms and informational resources, the IRS has a list of mechanisms to ensure that everyone, irrespective of their socioeconomic status or physical condition, has access to the benefits they rightfully deserve. For the disabled, who often face additional costs associated with medical care and mobility aids, the IRS offers a range of tax incentives designed to ease their financial troubles.
These include the Disabled Access Credit, which assists businesses in making their facilities more accessible, and the Earned Income Tax Credit (EITC), which can provide substantial relief to low-income disabled workers. Furthermore, deductions related to medical expenses can provide substantial savings for those facing substantial healthcare costs.
The Tax Credit for the Elderly or Disabled
Did you turn 65 or become legally blind in 2022? You’re eligible for an extra standard deduction on your tax returns. Here’s how it breaks down:
- Single Filer: A neat $1,750 awaits you.
- Blind and 65 or older? Double that! You’re looking at $3,500.
This tax credit goes beyond the concept of deductions, as it allows you to directly reduce the total amount of taxes you owe to the IRS, and in some cases, it can even result in a tax refund if the credit amount exceeds your tax liability. You must be at least 65 years old or permanently and totally disabled. Permanently disabled individuals are those who have a physical or mental impairment that is expected to last for an indefinite duration or result in death.
Your income must fall within certain limits to be eligible for this credit. These income thresholds are subject to change from year to year, so it’s crucial to stay updated with the latest IRS guidelines. Generally, the lower your income, the higher your potential credit. Your filing status, whether single, married filing jointly, or head of household, can affect your eligibility and the amount of the credit you can claim.
The Earned Income Tax Credit (EITC) Advantage
For those with disabilities earning within specified limits, the EITC is up for grabs. Note: The threshold depends on your filing status and number of dependents.
Child Tax Credit (CTC) & Additional Child Tax Credit (ACTC)
The Earned Income Tax Credit (EITC) is a U.S. federal tax program aimed at aiding low to moderate-income individuals and households. It offers tax relief or refunds based on earned income, family size, and filing status. To qualify, individuals must have earned income, be U.S. citizens or residents, possess valid Social Security numbers, and not be claimed as dependents.
It’s refundable, ensuring eligible recipients receive any excess credit as a refund. To claim the EITC, taxpayers must file a federal tax return, even if they don’t owe taxes. For parents with children living with disabilities, the CTC is available if income requirements are met and they have a qualifying child. The sweet deal? A credit of $2,000 per child.
Credit for Other Dependents (ODC)
Taxpayers who have dependents that don’t qualify for the Child Tax Credit may still be eligible to claim the Credit for Other Dependents on their 2022 tax return. This credit can be claimed alongside the Child and Dependent Care Credit and the Earned Income Credit.
This credit provides a maximum amount of $500 per qualified dependent, including those of any age, those with Social Security numbers or Individual Taxpayer Identification numbers, dependent parents or other eligible relatives supported by the taxpayer, and even dependents living with the taxpayer who aren’t related. The credit begins to phase out when a taxpayer’s income exceeds $200,000, or $400,000 for married couples filing jointly. To claim this credit, taxpayers must list the dependent on their tax return, be unable to claim the child tax credit or additional child tax credit for the dependent, and ensure the dependent is a U.S. citizen, national, or resident alien.
Medical Expense Deduction & Work Accessibility Deductions
Drowning in medical or dental bills? If these 2022 expenses exceeded 7.5% of your adjusted gross income (AGI), you might qualify to claim the Medical Expense Deduction. Remember, itemization is key. Lastly, for those who’ve spent to make their workspace more disability-friendly, there’s the Deduction for Disability-Related Work Expenses. Freelancers and self-employed individuals can chalk these up as business deductions.