Special Needs Tax Credit

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Special Needs Tax Credit is a proposed addition to the U.S. Internal Revenue Service tax code, which would enable a $5,000 refundable tax credit to reimburse family members of adults with special needs and seniors with dementia for the legal expenses of guardianship for their loved ones. It would also enable the creation of a Special needs trust for a person with disabilities. The proposal, initiated by Jaret L. Vogel in 2006, became draft legislation in 2009, and the "Special Needs Tax Credit" Bill was put before the United States Congress in March 2011. ^[1]

The Adoption tax credit has provided tax credits continuously since 1997. Special needs adoptions qualify for the maximum tax credit even if no qualified adoption expenses are incurred. Section 36C of the United States Internal Revenue code offers a credit for "qualified adoption expenses" paid or incurred by individual taxpayers.^[2]

A disabled individual can be claimed as a dependent on the tax return of a family member. There is no age limit on claiming the disabled individual as an exemption due to the disability. Head of household status and earned income tax credits are also possible benefits depending on the taxpayers situation. Medical expenses are also possible itemized deductions available to the taxpayer. ^[3]

• Palmer, Kimberly (September 30, 2008). "Financially Preparing for Special-Needs Kids". U.S. News.
• "Non-Profit Leads Push for Tax Credit for Special Needs Families". Academy of Special Needs Planners. October 31, 2008.
• "Support for Special Needs Tax Credit Continues to Grow". Academy of Special Needs Planners. August 5, 2009.
• Stapleton, Christine (March 2011). "To the Parents of Adult Children with Mental Illness: This Bill is for You". PsychCentral.
• "Help for parents of mentally ill adults". The Palm Beach Post. March 18, 2011.
• Special Needs Tax Credit Alliance, Inc.