Money & Care

The IRS Owes You for Your Mother’s Care (Maybe)

How to claw back thousands from the government when you're footing the bill for a parent's care.

By Neil D'Monte, Palmelle Editorial Team · Reviewed by Neil D'Monte · 7 min read · 2026-04-29

The IRS doesn't care that you spent your Saturday cleaning out your mother’s gutters or that you’re the only one who knows she needs her tea at exactly 175 degrees. They care about receipts, the 7.5% threshold, and whether her gross income is less than the price of a used Vespa. If you are paying for a parent’s care, you are likely sitting on a tax deduction worth five figures, but the government isn't going to tap you on the shoulder to offer it. You have to prove that your parent is, for tax purposes, your dependent—a designation that has nothing to do with how much they love you and everything to do with who pays for the groceries.

SHORT ANSWER

You can deduct care costs if your parent makes under $5,050 and you pay for over half their life.

The direct answer

To claim a parent’s care costs, they must meet the IRS definition of a 'qualifying relative,' meaning they earned less than $5,050 in 2024 (excluding Social Security) and you provided more than half of their financial support. If they qualify, you can deduct health-related expenses that exceed 7.5% of your adjusted gross income (AGI). This includes the entire cost of a nursing home if they are there primarily for health-related care, or just the specific care-related portion of a bill at a different type of care facility.

The $5,050 Gatekeeper

The first hurdle is the gross income test. For the 2024 tax year, your parent cannot have earned more than $5,050 in gross income to be claimed as your dependent. This number is deceptively low, but there is a massive loophole: Social Security usually doesn't count. If your mother lives on $24,000 a year of Social Security and has no other income, her 'gross income' in the eyes of the IRS is effectively zero.

However, if she sold some stocks or has a pension that pays out $500 a month, she’s over the limit. You can't claim her as a dependent, which means you can't claim the $500 Credit for Other Dependents. But here is the nuance: you can still potentially deduct her health-related expenses if you paid them directly to the provider, even if she doesn't meet the income test, provided you still meet the support test.

The support test requires you to provide more than 50% of her total financial support for the year. This includes food, lodging, clothing, doctor visits, and even small luxuries. If she spends $20,000 of her own money and you spend $21,000, you win. If she spends $21,000 and you spend $20,000, you get nothing. Keep a spreadsheet; the IRS loves a spreadsheet.

The 7.5% Threshold and the Nursing Home Loophole

You don't get to deduct every dollar you spend on care. You only get to deduct the amount that exceeds 7.5% of your Adjusted Gross Income (AGI). If your AGI is $100,000, the first $7,500 of care expenses is 'dead money'—it does nothing for your taxes. Every dollar after that, however, is a direct reduction of your taxable income.

When it comes to a nursing home, the deduction is often an all-or-nothing game. If your parent is in a nursing home primarily for health-related care, the entire bill—including room and board—is deductible. This is a massive win because room and board usually make up 60% of the cost. If they are in a different type of care facility primarily for personal reasons, you can only deduct the portion of the bill that pays for actual health-related services, like nursing care or physical therapy.

To prove the 'primarily for health-related care' part, you need a doctor’s note. This note should state that the person is chronically ill and requires a level of care that can only be provided in that setting. Without this note, the IRS will assume they are staying in a fancy apartment that happens to have a nurse on call, and they will deny the deduction for the rent and meals.

Modifying the House Without Losing Your Mind

If you are keeping your parent at home and need to modify the house, the IRS allows you to deduct these costs as health-related expenses. This includes installing ramps, widening doorways for a wheelchair, or adding grab bars in the bathroom. These aren't considered home improvements that increase the value of your property; they are considered 'essential for care.'

The math works like this: if you spend $10,000 on a walk-in tub and it increases your home’s value by $4,000, you can only deduct $6,000. However, the IRS generally accepts that things like ramps and widening hallways do not increase a home's resale value. In those cases, the full cost is deductible.

Don't forget the small stuff. Incontinence supplies, bandages, insulin, and even the mileage driven to and from the doctor's office (at 21 cents per mile in 2024) all count toward that 7.5% threshold. If you're paying for a home health aide, their wages are deductible, but their food is only deductible if you are paying for it on top of their wages. It’s a game of inches, and the inches add up to thousands.

Common mistakes

Paying your parent's bills from their own bank account.
To meet the '50% support' rule, the money must come from your accounts. If you use their money to pay their bills, you aren't supporting them; they are supporting themselves. Move the money to your account first or pay the providers directly from your funds.
Assuming 'Assisted Living' is the same as a 'Nursing Home' in tax law.
The IRS treats them differently. For a nursing home, the whole bill is often deductible. For other care facilities, you must get an itemized statement from the facility showing which part of the monthly fee went to health-related care vs. rent and food.

PALMELLE'S VIEW

The tax code is written for people who keep meticulous records, which is exactly what caregivers don't have time to do. However, our data shows that the average out-of-pocket cost for a nursing home is over $100,000 annually; ignoring the deduction is effectively giving the government a $25,000 gift you can't afford.

BOTTOM LINE

The tax code for caregivers is a rewards program for the organized. If you are paying for a nursing home or home modifications, get a doctor's letter today and start a dedicated folder for every receipt. It is the only way to get a refund for the emotional and financial toll of this chapter.

WHEN THIS CHANGES

These rules change if your parent is not a U.S. citizen or resident of the U.S., Canada, or Mexico, or if you are filing as Married Filing Separately and live with your spouse.

Frequently asked

Can I deduct the cost of a home health aide?

Yes, if a doctor certifies that your parent is chronically ill and requires help with at least two activities of daily living (ADLs), such as eating, dressing, or bathing. The aide's wages are fully deductible. If the aide also performs household chores like cleaning or cooking for you, you must pro-rate the deduction to only cover the time spent on the parent's care.

What if my siblings and I split the cost of care?

If no single person provides more than 50% support, but a group of you provides more than 50% together, you can use a Multiple Support Agreement (IRS Form 2120). This allows one of you to claim the parent as a dependent, provided that person contributes at least 10% of the support. You usually rotate who gets the deduction each year.

Are OTC medications deductible?

Generally, no. The IRS only allows deductions for prescribed drugs and insulin. Even if a doctor tells you to give your parent a daily aspirin or a specific vitamin, you cannot deduct the cost unless it is a prescription-strength version that requires a pharmacist to dispense it.