Credit for Caring Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 2730 To amend the Internal Revenue Code of 1986 to provide a nonrefundable credit for working family caregivers. IN THE HOUSE OF REPRESENTATIVES MAY 14, 2019 Ms. SA´NCHEZ (for herself and Mr. REED) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend the Internal Revenue Code of 1986 to provide a nonrefundable credit for working family caregivers. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Credit for Caring Act 4 of 2019’’. 5 SEC. 2. CREDIT FOR WORKING FAMILY CAREGIVERS. 6 (a) IN GENERAL.—Subpart A of part IV of sub- 7 chapter A of chapter 1 of the Internal Revenue Code of 8 1986 is amended by inserting after section 25D the fol- 9 lowing new section: 10 VerDate Sep 11 2014 22:14 May 25, 2019 Jkt 034408 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H2730.IH H2730 pbinns on DSK79D2C42PROD with BILLS 2 •HR 2730 IH ‘‘SEC. 25E. WORKING FAMILY CAREGIVERS. 1 ‘‘(a) ALLOWANCE OF CREDIT.—In the case of an eli- 2 gible caregiver, there shall be allowed as a credit against 3 the tax imposed by this chapter for the taxable year an 4 amount equal to 30 percent of the qualified expenses paid 5 by the taxpayer during the taxable year to the extent that 6 such expenses exceed $2,000. 7 ‘‘(b) LIMITATION.— 8 ‘‘(1) IN GENERAL.—The amount allowed as a 9 credit under subsection (a) for the taxable year shall 10 not exceed $3,000. 11 ‘‘(2) ADJUSTMENT FOR INFLATION.—In the 12 case of any taxable year beginning after 2019, the 13 dollar amount contained in paragraph (1) shall be 14 increased by an amount equal to the product of— 15 ‘‘(A) such dollar amount, and 16 ‘‘(B) the medical care cost adjustment de- 17 termined under section 213(d)(10)(B)(ii) for 18 the calendar year in which the taxable year be- 19 gins, determined by substituting ‘2018’ for 20 ‘1996’ in subclause (II) thereof. 21 If any increase determined under the preceding sen- 22 tence is not a multiple of $50, such increase shall 23 be rounded to the next lowest multiple of $50. 24 VerDate Sep 11 2014 22:14 May 25, 2019 Jkt 034408 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2730.IH H2730 pbinns on DSK79D2C42PROD with BILLS 3 •HR 2730 IH ‘‘(c) ELIGIBLE CAREGIVER.—For purposes of this 1 section, the term ‘eligible caregiver’ means an individual 2 who— 3 ‘‘(1) during the taxable year pays or incurs 4 qualified expenses in connection with providing care 5 for a qualified care recipient, and 6 ‘‘(2) has earned income (as defined in section 7 32(c)(2)) for the taxable year in excess of $7,500. 8 ‘‘(d) QUALIFIED CARE RECIPIENT.—For purposes of 9 this section— 10 ‘‘(1) IN GENERAL.—The term ‘qualified care re- 11 cipient’ means, with respect to any taxable year, any 12 individual who— 13 ‘‘(A) is the spouse of the eligible caregiver, 14 or any other person who bears a relationship to 15 the eligible caregiver described in any of sub- 16 paragraphs (A) through (H) of section 17 152(d)(2), and 18 ‘‘(B) has been certified, before the due 19 date for filing the return of tax for the taxable 20 year, by a licensed health care practitioner (as 21 defined in section 7702B(c)(4)) as being an in- 22 dividual with long-term care needs described in 23 paragraph (3) for a period— 24 VerDate Sep 11 2014 22:14 May 25, 2019 Jkt 034408 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2730.IH H2730 pbinns on DSK79D2C42PROD with BILLS 4 •HR 2730 IH ‘‘(i) which is at least 180 consecutive 1 days, and 2 ‘‘(ii) a portion of which occurs within 3 the taxable year. 4 ‘‘(2) PERIOD FOR MAKING CERTIFICATION.— 5 Notwithstanding paragraph (1)(B), a certification 6 shall not be treated as valid unless it is made within 7 the 391⁄2-month period ending on such due date (or 8 such other period as the Secretary prescribes). 9 ‘‘(3) INDIVIDUALS WITH LONG-TERM CARE 10 NEEDS.—An individual is described in this para- 11 graph if the individual meets any of the following re- 12 quirements: 13 ‘‘(A) The individual is at least 6 years of 14 age and— 15 ‘‘(i) is unable to perform (without 16 substantial assistance from another indi- 17 vidual) at least 2 activities of daily living 18 (as defined in section 7702B(c)(2)(B)) due 19 to a loss of functional capacity, or 20 ‘‘(ii) requires substantial supervision 21 to protect such individual from threats to 22 health and safety due to severe cognitive 23 impairment and is unable to perform, with- 24 out reminding or cuing assistance, at least 25 VerDate Sep 11 2014 22:14 May 25, 2019 Jkt 034408 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H2730.IH H2730 pbinns on DSK79D2C42PROD with BILLS 5 •HR 2730 IH 1 activity of daily living (as so defined) or 1 to the extent provided in regulations pre- 2 scribed by the Secretary (in consultation 3 with the Secretary of Health and Human 4 Services), is unable to engage in age ap- 5 propriate activities. 6 ‘‘(B) The individual is at least 2 but not 7 6 years of age and is unable due to a loss of 8 functional capacity to perform (without sub- 9 stantial assistance from another individual) at 10 least 2 of the following activities: eating, trans- 11 ferring, or mobility. 12 ‘‘(C) The individual is under 2 years of age 13 and requires specific durable medical equipment 14 by reason of a severe health condition or re- 15 quires a skilled practitioner trained to address 16 the individual’s condition to be available if the 17 individual’s parents or guardians are absent. 18 ‘‘(e) QUALIFIED EXPENSES.—For purposes of this 19 section— 20 ‘‘(1) IN GENERAL.—Subject to paragraph (4), 21 the term ‘qualified expenses’ means expenditures for 22 goods, services, and supports that— 23 ‘‘(A) assist a qualified care recipient with 24 accomplishing activities of daily living (as de- 25 VerDate Sep 11 2014 22:14 May 25, 2019 Jkt 034408 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H2730.IH H2730 pbinns on DSK79D2C42PROD with BILLS 6 •HR 2730 IH fined in section 7702B(c)(2)(B)) and instru- 1 mental activities of daily living (as defined in 2 section 1915(k)(6)(F) of the Social Security 3 Act (42 U.S.C. 1396n(k)(6)(F))), and 4 ‘‘(B) are provided solely for use by such 5 qualified care recipient. 6 ‘‘(2) ADJUSTMENT FOR OTHER TAX BENE- 7 FITS.—The amount of qualified expenses otherwise 8 taken into account under paragraph (1) with respect 9 to an individual shall be reduced by the sum of any 10 amounts paid for the benefit of such individual for 11 the taxable year which are— 12 ‘‘(A) taken into account under section 21 13 or 213, or 14 ‘‘(B) excluded from gross income under 15 section 129, 223(f), or 529A(c)(1)(B). 16 ‘‘(3) GOODS, SERVICES, AND SUPPORTS.—For 17 purposes of paragraph (1), goods, services, and sup- 18 ports (as defined by the Secretary) shall include— 19 ‘‘(A) human assistance, supervision, cuing 20 and standby assistance, 21 ‘‘(B) assistive technologies and devices (in- 22 cluding remote health monitoring), 23 ‘‘(C) environmental modifications (includ- 24 ing home modifications), 25 VerDate Sep 11 2014 22:14 May 25, 2019 Jkt 034408 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H2730.IH H2730 pbinns on DSK79D2C42PROD with BILLS 7 •HR 2730 IH ‘‘(D) health maintenance tasks (such as 1 medication management), 2 ‘‘(E) information, 3 ‘‘(F) transportation of the qualified care 4 recipient, 5 ‘‘(G) non-health items (such as inconti- 6 nence supplies), and 7 ‘‘(H) coordination of and services for peo- 8 ple who live in their own home, a residential 9 setting, or a nursing facility, as well as the cost 10 of care in these or other locations. 11 ‘‘(4) QUALIFIED EXPENSES FOR ELIGIBLE 12 CAREGIVERS.—For purposes of paragraph (1), the 13 following shall be treated as qualified expenses if 14 paid or incurred by an eligible caregiver: 15 ‘‘(A) Expenditures for respite care for a 16 qualified care recipient. 17 ‘‘(B) Expenditures for counseling, support 18 groups, or training relating to caring for a 19 qualified care recipient. 20 ‘‘(C) Lost wages for unpaid time off due to 21 caring for a qualified care recipient as verified 22 by an employer. 23 ‘‘(D) Travel costs of the eligible caregiver 24 related to caring for a qualified care recipient. 25 VerDate Sep 11 2014 22:14 May 25, 2019 Jkt 034408 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H2730.IH H2730 pbinns on DSK79D2C42PROD with BILLS 8 •HR 2730 IH ‘‘(E) Expenditures for technologies, as de- 1 termined by the Secretary, that assist an eligi- 2 ble caregiver in providing care for a qualified 3 care recipient. 4 ‘‘(5) HUMAN ASSISTANCE.—The term ‘human 5 assistance’ includes the costs of a direct care worker. 6 ‘‘(6) DOCUMENTATION.—An expense shall not 7 be taken into account under this section unless the 8 eligible caregiver substantiates such expense under 9 such regulations or guidance as the Secretary shall 10 provide. 11 ‘‘(7) MILEAGE RATE.—For purposes of this sec- 12 tion, the mileage rate for the use of a passenger 13 automobile shall be the standard mileage rate used 14 to calculate the deductible costs of operating an 15 automobile for medical purposes. Such rate may be 16 used in lieu of actual automobile-related travel ex- 17 penses. 18 ‘‘(8) COORDINATION WITH ABLE ACCOUNTS.— 19 Qualified expenses for a taxable year shall not in- 20 clude contributions to an ABLE account (as defined 21 in section 529A). 22 ‘‘(f) PHASE OUT BASED ON ADJUSTED GROSS IN- 23 COME.—For purposes of this section— 24 VerDate Sep 11 2014 22:14 May 25, 2019 Jkt 034408 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H2730.IH H2730 pbinns on DSK79D2C42PROD with BILLS 9 •HR 2730 IH ‘‘(1) IN GENERAL.—The amount of the credit 1 allowable under subsection (a) shall be reduced (but 2 not below zero) by $100 for each $1,000 (or fraction 3 thereof) by which the taxpayer’s modified adjusted 4 gross income exceeds the threshold amount. 5 ‘‘(2) MODIFIED ADJUSTED GROSS INCOME.— 6 The term ‘modified adjusted gross income’ means 7 adjusted gross income increased by any amount ex- 8 cluded from gross income under section 911, 931, or 9 933. 10 ‘‘(3) THRESHOLD AMOUNT.—The term ‘thresh- 11 old amount’ means— 12 ‘‘(A) $150,000 in the case of a joint re- 13 turn, and 14 ‘‘(B) $75,000 in any other case. 15 ‘‘(4) INDEXING.—In the case of any taxable 16 year beginning in a calendar year after 2019, each 17 dollar amount contained in paragraph (3) shall be 18 increased by an amount equal to the product of— 19 ‘‘(A) such dollar amount, and 20 ‘‘(B) the cost-of-living adjustment deter- 21 mined under section 1(f)(3) for the calendar 22 year in which the taxable year begins, deter- 23 mined by substituting ‘‘calendar year 2018’’ for 24 VerDate Sep 11 2014 22:14 May 25, 2019 Jkt 034408 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H2730.IH H2730 pbinns on DSK79D2C42PROD with BILLS 10 •HR 2730 IH ‘‘calendar year 2016’’ in subparagraph (A)(ii) 1 thereof. 2 ‘‘(5) ROUNDING RULE.—If any increase deter- 3 mined under paragraph (4) is not a multiple of $50, 4 such increase shall be rounded to the next lowest 5 multiple of $50. 6 ‘‘(g) IDENTIFICATION REQUIREMENTS.—No credit 7 shall be allowed under this section to a taxpayer with re- 8 spect to any qualified care recipient unless the taxpayer 9 includes the name and taxpayer identification number of 10 such individual, and the identification number of the li- 11 censed health care practitioner certifying such individual, 12 on the return of tax for the taxable year.’’. 13 (b) CLERICAL AMENDMENT.—The table of sections 14 for subpart A of part IV of subchapter A of chapter 1 15 of such Code is amended by inserting after the item relat- 16 ing to section 25D the following new item: 17 ‘‘Sec. 25E. Working family caregivers.’’. (c) EFFECTIVE DATE.—The amendments made by 18 this section shall apply to taxable years beginning after 19 December 31, 2018. 20 Æ VerDate Sep 11 2014 22:14 May 25, 2019 Jkt 034408 PO 00000 Frm 00010 Fmt 6652 Sfmt 6301 E:\BILLS\H2730.IH H2730 pbinns on DSK79D2C42PROD with BILLS