Taxpayers over age 65 often live on fixed incomes and spend more on certain expenses, such as medical and dental care. For this reason, the Internal Revenue Service offers certain tax breaks designed specifically for them. These tax breaks include both deductions and tax credits.
If you are over 65 and you take the standard deduction instead of itemizing, you may be entitled to a higher deduction amount. You can also claim this higher deduction if your spouse is 65 or older. However, you can't claim a higher deduction amount for any other individual over 65, even if the person qualifies as a dependent. If you qualify for a higher standard deduction, claim it on line 40 of Form 1040.
Credit for the Elderly
Taxpayers age 65 or older may be able to qualify for the credit for the elderly. To claim this credit, you must have been 65 by the end of the tax year. The IRS considers you to be age 65 by the end of the year if your 65th birthday is sometime during the year or on Jan. 1 of the following year. Individuals under age 65 may also be able to qualify for this credit if they are retired and receiving taxable disability income.
Child and Dependent Care Credit
Elderly taxpayers sometimes require professional in-home care. If you pay for professional in-home care so that someone else in the household can work, you may be able to qualify for the child and dependent care credit. To claim this credit, the person receiving the care must qualify as the dependent of the person who pays for it, or the two individuals must be married. If you qualify for the credit, you can claim up to 35 percent of the expenses you pay during the year.
Individuals over age 65 can also qualify for other common deductions, such as the medical expenses deduction, which allows you to deduct expenses that exceed 7.5 percent of your adjusted gross income. This threshold rises to 10 percent for the 2013 tax year but stays the same until 2016 for those over 65. However, many deductions require the taxpayer to itemize. If you itemize, you won't be able to claim the higher standard deduction amount available to taxpayers over 65. Calculate your taxes both ways to determine which results in the lowest tax obligation.
Amanda McMullen is a freelancer who has been writing professionally since 2010. She holds a bachelor's degree in mathematics and statistics and a second bachelor's degree in integrated mathematics education.