Next in our series of tax-time blogs, we are outlining the benefits you may be entitled to if you have a family member living in long-term care.
1. Claim Involuntary Separation for your Guaranteed Income Supplement
If you are receiving the Guaranteed Income Supplement (GIS) and have a spouse residing in long-term care, you may apply as single individuals rather than as a couple, allowing both persons to be eligible for the GIS.
Each person needs to apply separately for the GIS. In the application form (section c), indicate your marital status as “ separated “and note “involuntary” on the right-hand portion of the application. For the remainder of the application form, provide the required information for yourself.
2. Long-term care home expenses may be claimed as a medical expenses
The costs associated with a long-term care home may be claimed as a medical expense on your tax return and reduce taxes otherwise payable. You may claim the expenses on behalf of your spouse or a dependant (a dependant is defined as relative with a mental or physical disability who depends on you for financial support). You may claim only amounts exceeding the lesser of 3% of the dependent’s net income and $2,152.There is no limit on the amount you may claim.
The amount is calculated by adding the total of the allowable medical expenses minus the lesser of $2,152 or 3% of net income. Amounts above this threshold will be subject to a 15% federal credit.
If you claim as a medical expense all costs associated with a long-term care home, you will not be eligible for the disability amount tax credit. Depending upon your tax situation, you may wish to consider claiming the disability amount tax credit and then for medical expenses claiming the allowable portion of amounts paid relating only to salaries and wages for attendant care expenses.
3.Ontario Trillium Benefit and Ontario Seniors Property Tax Grant
You may qualify for several tax credits that are designed to help Ontarians pay for energy costs, sales taxes and property taxes. If your spouse is a resident in a long-term care facility, you may claim ‘involuntary separation’ and each apply for the benefit as separate individuals.
Subject to income levels, the benefits could amount to approximately $2,000 per individual if you incur property taxes, heating costs and sales taxes The amount of the benefit for the spouse living in long-term care will depend whether the institution is private or public.
Please be sure to consult with a qualified tax professional when determining your eligibility for these tax benefits.