Vermont S 231: An act relating to a family caregiver tax credit

Bill Text

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S.231 1
Introduced by Senators Hardy, Brock, Clarkson, Gulick, Lyons, Major and 2
Williams 3
Referred to Committee on 4
Date: 5
Subject: Taxation; income tax; tax credit; family caregiver tax credit 6
Statement of purpose of bill as introduced: This bill proposes to create an 7
income tax credit for family caregivers. The bill would further exclude an 8
individual’s income from household income for purposes of a property tax 9
credit if a member of the household has properly claimed a family caregiver 10
credit for the individual in the most recent tax year. 11
An act relating to a family caregiver tax credit 12
It is hereby enacted by the General Assembly of the State of Vermont: 13
Sec. 1. 32 V.S.A. § 5813 is amended to read: 14
§ 5813. STATUTORY PURPOSES 15
* * * 16
(bb) The statutory purpose of the family caregiver tax credit in section 17
5830g of this title is to compensate Vermont taxpayers who incur expenses 18
relating to care provided to a family member with long-term care needs. 19

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Sec. 2. 32 V.S.A. § 5830g is added to read: 1
§ 5830g. VERMONT FAMILY CAREGIVER TAX CREDIT 2
(a) A resident individual or part-year resident individual shall be entitled to 3
a refundable credit against the tax imposed by section 5822 of this title. 4
(b) The credit available under this section shall be limited to expenses that: 5
(1) are qualified expenses under this section; and 6
(2) are not creditable to the Child and Dependent Care Credit under 26 7
U.S.C. § 21, including expenses that do not qualify as employment-related 8
expenses under 26 U.S.C. § 21(b)(2) and expenses for an individual with long-9
term care needs who is not a qualifying individual under 26 U.S.C. § 21(b)(1). 10
(c)(1) The amount of credit available under this section shall be equal to 30 11
percent of the qualified expenses paid by the taxpayer during the taxable year 12
for an individual with long-term care needs. The maximum allowable credit 13
per taxable year shall be $2,500.00. The amount of the credit for a part-year 14
resident shall be multiplied by the percentage that the individual’s income that 15
is earned or received during the period of the individual’s residency in this 16
State bears to the individual’s total income. 17
(2) The amount of the credit provided under this section shall be 18
reduced by $50.00 for each $1,000.00, or fraction thereof, by which the 19
individual’s adjusted gross income exceeds $125,000.00, irrespective of the 20

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individual’s filing status. For purposes of this subsection, spouses filing 1
jointly shall be considered an individual. 2
(3) Beginning with taxable year 2027, the maximum allowable credit 3
shall be adjusted annually for inflation using the last Consumer Price Index for 4
All Urban Consumers published by the U.S. Department of Labor. 5
(d) Definitions. As used in this section: 6
(1) “Activities of daily living” means: 7
(A) tasks such as eating, toileting, grooming, dressing, bathing, and 8
transferring; and 9
(B) meal planning and preparation; managing finances; shopping for 10
food, clothing, and other essential items; performing essential household 11
chores; communicating by phone or other media; and traveling around and 12
participating in the community. 13
(2) “Individual with long-term care needs” means an individual who: 14
(A) is at least 14 years of age; 15
(B) is related to the caregiver by blood, civil marriage, or adoption; 16
(C) has a medically diagnosed disability or health condition; 17
(D) does not reside at a residential care home, an assisted living 18
residence, or nursing home as defined by 33 V.S.A. § 7102, or any other 19
similar adult care home that is licensed or required to be licensed pursuant to 20
33 V.S.A. chapter 71; and 21

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(E) is unable to perform without substantial assistance from another 1
individual at least two activities of daily living due to a loss of functional 2
capacity; or 3
(F) requires substantial supervision to protect the individual from 4
threats to health and safety due to severe cognitive impairment and is unable to 5
perform, without reminding or cuing assistance, at least one activity of daily 6
living. 7
(3) “Qualified expenses” means expenditures for goods, services, and 8
supports that assist an individual with long-term care needs with 9
accomplishing activities of daily living and may include reasonable 10
expenditures for goods, services, and supports for the caregiver. Qualified 11
expenses include expenditures relating to care, such as respite care, adult 12
daycare, counseling, support groups, training, lost wages for unpaid time off 13
due to providing care as verified by an employer, travel costs relating to care, 14
and assistive technologies. For purposes of this subsection, “goo