Can I deduct for paying for in-home elder care for parents?

[RMD20201]

If I pay for in-home elder care services for my parents, am I able to take any deductions? I am filing as a Single and require someone to take care of my parents while I work.

And if my parents paid for some of the services to take care of them (post-surgery, doc appts, housework, etc.), can they claim any of the expenses on their tax return if they filed Married Filing Jointly? They get Social Security, have 1099-INT, 1099-R.

I filled out the ITA IRS form (https://www.irs.gov/help/ita/do-i-qualify-for-the-credit-for-the-elderly-or-disabled) and it seems like I would qualify for a maximum of $6K and would have to submit Form 2441, Child and Dependent Care Expenses. When I filled out the form, I answered for each parent with:

What tax year are you asking about? 2023

What is your filing status for 2023? Single

Did you pay or incur expenses to care for a person under age 13, or a person who was physically/mentally unable to care for himself/herself, in order to work or look for work? Yes

Of the expenses incurred to allow you to work or look for work, what portion did you incur for the care recipient(s) to attend kindergarten or a higher grade of school? None

What portion of the care, if any, was provided by one or more of the following:

• your dependent (or your spouse's dependent if you were married)
• your child who was under age 19 at the end of 2023
• a person who was your spouse at any time during 2023
• the parent of your qualifying person if your qualifying person is your child and under age 13

None

Did you prepay 2024 dependent care expenses in 2023? No

Did you pay dependent care expenses in 2023 but incur the expenses in a prior year? No

Were at least some of the expenses paid in 2023 or prepaid in a prior year? Yes

Did you have earned income during the tax year? Yes

First Name: Dad

First Name: Mom

What is Dad's relationship to you? Other

What is Dad's date of birth? MM/DD/YYYY

Was Dad a person who was physically or mentally unable to care for himself or herself? Yes

Are you claiming Dad as a dependent on your return? No

Did Dad live with you for more than half the year? Yes

Would Dad have been your dependent except that he or she is filing a joint return? Yes

Does Dad have a taxpayer identification number (SSN, ATIN or ITIN)? Yes

And repeated the same for Mom. 

We paid ~$6K in cash for in-home care services in 2023. 

Does this sound correct that a deduction is possible? Either I take it or my parents?

My parents do not qualify for the "Elderly or Disabled Credit'. And when I enter the information for the question "Did you pay for child and dependent care in 2023?", I selected "No" because the description has:
"We might be able to get you a big break on your taxes if you paid someone to take care of a child or a dependent so you could work, look for work or go to school." - my parents are retired. 

Trying to figure out if there is a eligible deduction that can be considered. Any help / advice would be greatly appreciated.

Thank you!!

[RMD20201]

Any suggestions or advice?

[MonikaK1 · Accepted solution]

According to the IRS, a qualifying individual for the child and dependent care credit is:

• Your dependent qualifying child who was under age 13 when the care was provided,
• Your spouse who was physically or mentally incapable of self-care and lived with you for more than half of the year, or
• An individual who was physically or mentally incapable of self-care, lived with you for more than half of the year, and either: (a) was your dependent; or (b) could have been your dependent except that he or she received gross income of $4,700 or more, or filed a joint return, or you (or your spouse, if filing jointly) could have been claimed as a dependent on another taxpayer's 2023 return.

Physically or mentally not able to care for oneself - An individual is physically or mentally incapable of self-care if, as a result of a physical or mental defect, the individual is incapable of caring for his or her hygiene or nutritional needs or requires the full-time attention of another person for the individual's own safety or the safety of others.

In order for you to claim the Dependent Care Credit, your parents would have to live with and be supported by you, and would qualify as your dependents except for the gross income test ($4,700 for 2023 per person), as well as meet the other qualifications above,

If all of these tests are met, you can enter the expenses you paid in the Deductions and Credits section of TurboTax on your return and complete the interview questions to determine whether you are eligible for the credit. See this TurboTax tips article for more information.

If you are paying a household employee directly, who is not employed by an agency, then you would need to file Schedule H with your tax return, and you have responsibility for paying and reporting employment taxes. See this TurboTax tips article for more information,

[RMD20201]

Thank you, @MonikaK1.

Bullet (b) applies as in they are physically incapable of self-care, lived with me (filing as single) for more than half of the year BUT my parents gross income is more than $4,700 filing their own joint return and are not my dependents. 

• An individual who was physically or mentally incapable of self-care, lived with you for more than half of the year, and either: (a) was your dependent; or (b) could have been your dependent except that he or she received gross income of $4,700 or more, or filed a joint return, or you (or your spouse, if filing jointly) could have been claimed as a dependent on another taxpayer's 2023 return.

In the "Your 2023 Deductions & Credits" section > section "You and Your Family" >

• Money-Saving Credits Related to Your Family > Do you want to see if you qualify for these credits? > Yes.
• Did you pay for child and dependent care in 2023? Yes.
• Enter Additional People > Would you like to go back to the Dependents section now? Yes.
• Do You Have Children or Financially Support Another Person? Yes, I have children or financially support another person > Continue.
• Who Do You Support? Another person (includes half and step relatives, and in-laws)
  The person I support is my: Parent > I entered my father's information and then, my mother's information who are US citizens, lived with me for the whole year in U.S. > parents married and filed joint return and paid taxes on interest earned, etc. but no W-2 (income).
• Based on the above, my parents do not qualify as my dependents. 
• "It turns out you don't qualify for this credit".

So, I guess my parents income has to be under $4,700 for the year in order to me to qualify taking any deduction/credit.  And I do not know how to claim them under "A person above the gross income limit for dependents - If the person who received the care would have been your dependent but he or she did not meet the gross income requirement (he or she earned more than $4,700, the limit for gross income), you can claim his or her care expenses as long as you meet other requirements for the child and dependent care credit."

I am confused.

[AmyC · Accepted solution]

Your parents may have medical expenses. See Publication 502, Medical and Dental Expenses. As for you, follow these steps:

1. Select the child care, answer yes to begin. For some reason, I had to do it twice before it let me through.
2. Select yes I support another person
3. Select support another person
4. From drop down, select parent
5. Fill in name, birthday, citizen, continue
6. Answer time with you
7. Select disabled, continue
8. Marital status
9. Joint return
10. Refund of tax withheld - if your parents have a refundable tax credit, you do not qualify. See Refundable tax credits | Internal Revenue Service
11. Will there be taxable income? The answer must be no or you do not get the credit
12. Continue
13. Did parent make $4700 or more? Note Social Security is generally NOT included in this. See the what counts as income link.
14. Did you pay over half the support? Yes  goes to good news or No which asks about support agreements and other. Look at the support link. Housing and other expenses add up without realizing how much is for them. If just the 3 of you live together, then 2/3 of all utility bills, mortgage/rent, etc are expenses for them living there.
15. continue through the questions