Elder Law


What Are The Federal Tax Credits for the Elderly or the Disabled

What Are The Federal Tax Credits for the Elderly or the Disabled

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What Are The Federal Tax Credits for the Elderly or the Disabled

A federal tax credit is an immediate reduction in taxes based upon two stipulations - taxes already deducted or benefits received from a state through the tax system. This makes it different from a federal tax deduction which is applied after filing a tax return and only applies to taxable income. The Internal Revenue Service (IRS) makes federal tax credits available for many people who qualify under guidelines established in the Internal Revenue Code. The purpose of these federal tax credits is to provide tax relief for those that need it. One such federal tax credit is made available to the elderly and the disabled.

In order to receive these federal tax credits there are specific eligibility requirements that must be met. Standard requirements are that the applicant must be a United States citizen or a resident alien living permanently in the United State. For the elderly, they must have reached the age of 65 to apply. The IRS defines any person that has reached the age of 65 as an elderly person. Another eligibility requirement for the elderly person is based on their adjusted gross income (AGI) for that tax year. If the taxpayer's AGI is above a certain annual amount, they are ineligible for the federal tax credit.

         For a single taxpayer filing a tax return, the limit is $17,500.

         For a married couple filing a joint return, the limit is $20,000 if only one partner is eligible. The limit is $25,000 if both partners are eligible.

         For a married couple filing separate tax returns, the limit is $12,500.

         For the head of the household return, the limit is $17,500.

         For a qualifying widow(er) filing a tax return, the limit is $17,500.

These income limitations also apply to disabled persons applying for this federal tax credit.

If the disabled person apply for the federal tax credit is under the age of 65, he or she must be retired on permanent or total disability. This means the person has had to stop working due to a disability that makes the person incapable of gainful employ. Any work done in the year prior to the application for these federal tax credits may disqualify that person. The disabled person must also have received disability payments that can be taxed during the year in which they are applying for these federal tax credits.

Also, if the disabled person is receiving a disability pension through an employer, he or she must not have reached retirement age at the beginning of the tax year. The Social Security Administration mandates the full retirement age based upon the year in which a person is born. For example, if someone is born in 1960 or later, the full retirement age is 67.


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