HB1076
To Create The Caring For Caregivers Act; And To Provide An Income Tax Credit For Expenses Incurred In Caring For Certain Family Members.
Last Action (May 5, 2025): Died in House Committee at Sine Die adjournment.
Sponsors
AI-Generated Summary
House Bill 1076, known as the 'Caring for Caregivers Act,' establishes a non-refundable income tax credit for eligible family caregivers in Arkansas. To qualify, caregivers must have an adjusted gross income of less than $50,000 and provide support to family members who are at least 62 years old, reside in a private home, and require assistance with at least two activities of daily living. Eligible expenditures include home modifications, medical equipment, and services like respite care, adult day care, and personal care attendants. The bill allows for a tax credit of 50% of eligible expenditures, capped at $2,000 annually, or $3,000 if the cared-for family member is a veteran or has dementia. The total amount of credits awarded annually is capped at $1.5 million, with credits distributed on a first-come, first-served basis. The act is effective for tax years beginning on or after January 1, 2025.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries are low-to-moderate-income family caregivers who provide unpaid care for aging or disabled relatives living in private residences. Specifically, those who care for veterans or individuals diagnosed with dementia stand to benefit more significantly due to the higher credit cap. Secondary beneficiaries include the elderly and disabled family members themselves, who may experience improved quality of life and be better able to remain in their own homes rather than transitioning to institutional care settings.
Who Might Suffer?
The primary group negatively impacted is the State of Arkansas, which would experience a reduction in general tax revenue due to the provision of these income tax credits. Additionally, because the bill caps the total annual state expenditure for these credits at $1.5 million and allocates them on a first-come, first-served basis, some eligible caregivers who apply late in the tax cycle may be denied benefits despite meeting all criteria. There is no specified impact on other groups, as the tax credit is funded through the state treasury rather than shifting costs to specific taxpayers or industries.
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