How to Claim Dependents That Live in Assisted Living

Claim a dependent residing in assisted living to reduce your tax burden.

Keeping elderly dependents in assisted living can be expensive. Claiming them as dependents on your taxes helps you save money and better afford their care. To claim a person residing in assisted living as a dependent, your relationship to her, her income and your contributions to her income must be documented and within Internal Revenue Service (IRS) guidelines. The more dependents you claim, the lower your federal tax burden at the end of the year.

Instructions

1. Confirm that the person you want to claim is related to you. She must also be a United States citizen, resident alien or national of the United States, or have citizenship in either Canada or Mexico for you to claim her. Ask her if she files a joint tax return with anyone. If she does, you can't claim her as a dependent.

2. Calculate his personal income. It can't exceed the IRS's personal exemption. The amount of the exemption changes annually. In 2010, it was set at $3,650. Keep in mind that Social Security income isn't taxed unless he has more than $25,000 in total income.

3. Gather receipts that show her total expenses for the year -- include assisted living charges, food, medical bills, clothing, entertainment and transportation. You must provide more than 50 percent of her income to claim her as a dependent. Show that you exceeded the amount she gets from Social Security, if applicable.

4. Include him on your tax return as a dependent. Obtain his social security number to list on your tax forms.

5. Store the receipts and records proving her dependency in a safe place. You may be asked for proof of the amount you claim to have paid on her behalf.

References

• "The New York Times": Ask an Elder Law Attorney: Claiming a Parent as a Dependent
• Aging Care: Tax Tips for Caregivers: Can I Claim My Elderly Parent as a Dependent?