Credit for Caring Act of 2025

This bill creates a federal income tax credit to help working people who care for a family member with long-term care needs. You could claim 30% of your caregiving costs that are over $2,000, up to a maximum credit of $5,000. The $5,000 cap would rise with inflation after 2025. The credit shrinks as your income goes up, starting at $150,000 for couples filing jointly and $75,000 for others, decreasing by $100 for every $1,000 over those amounts .

To qualify, you must earn more than $7,500 in the year and pay for care for a spouse or close relative who has certified long-term care needs that last at least 180 days. Long-term care needs can include trouble with daily activities like eating, dressing, or moving around, or serious cognitive issues; there are specific rules for children under 6 and under 2 as well. You must list the family member’s and certifying health professional’s identification numbers on your tax return .

Covered costs include things that help your family member live day to day, such as a home care aide, assistive devices or remote monitoring, home modifications, transportation, medication management, incontinence supplies, and care provided at home or in a facility. Caregivers’ own costs can count too, like respite care, counseling or training, lost wages from unpaid time off (with employer verification), travel related to caregiving, and certain care-related technologies. Some expenses can’t be double-counted if you already used other tax benefits for them .

Key points

• Who is affected: Working people who care for a spouse or close relative with certified long-term care needs .
• What changes: A new, refundable-style tax credit up to $5,000 for 30% of qualified caregiving costs above $2,000; phase-out at higher incomes; indexing after 2025 .
• What counts as expenses: Home care help, assistive tech, home changes, transportation, respite, caregiver training/counseling, certain lost wages, and travel tied to care; coordination rules apply to avoid double benefits .