Early in the presidential campaign, Hillary Clinton proposed a package of ideas aimed at helping adult children who care for aging parents and other relatives. Yesterday, Donald Trump embraced a similar idea. Family caregiving, it seems, is going mainstream.
It is striking that both Clinton and Trump are talking about an issue that until now has flown far below the political radar. Best I can tell, this is the first time any major party candidate for president, let alone both, has proposed ways to help caregivers.
Trump’s proposal is easy to miss, since he is promoting it as a child care plan. And it leaves out many key details. But it also would support those caring for what Trump calls “elderly dependents.”
His plan would work like this: Caregivers would be able to take a tax deduction of up to $5,000 for costs of home care, adult day programs, and the like. It would be available to singles with income less than $250,000 or couples making $500,000 or less (which is to say, nearly everyone). Both those who itemize their deductions and those who take the standard deduction would get the subsidy. He’d provide an additional “rebate” to low-income households by increasing the Earned Income Tax Credit.
Interestingly, the deduction might even be available to those who stay home to care for parents and do not use paid caregivers. He also proposes six weeks of “partial” paid “maternity” leave, though it is not clear if it would also be available to those caring for aging parents.
Finally, Trump would create a new Dependent Care Savings Account, in which families could contribute tax-free savings to help pay for long-term care costs. Participants could contribute up to $2,000 annually. Not only would contributions be deductible, but the accounts would also grow tax-free. The government would also make a modest match for low-income participants.
But Trump’s plan has many gaps and some serious flaws.
Even with caps on deductions and savings-account contributions, the cost of this program would be enormous (The US has somewhere between 17 milllion and 44 million family caregivers—depending on who is counting). And Trump describes no plan to pay for it. Worse, it would be very poorly targeted, with many of the benefits aimed at those high-income households who need it least.
By its nature, a tax deduction is more beneficial to high-income taxpayers than those with low incomes. For example, Trump has separately proposed three individual tax brackets: 12-25-33 percent. If you spend $5,000 for your mom’s personal assistance and are in the 12 percent bracket, your deduction reduces your taxes by $600. If you are in Trump’s 33 percent bracket, it is worth $1,650—almost three times as much.
It is unclear how helpful the additional tax subsidies would be for very low-income households, since many of the aging parents in these families would likely be receiving Medicaid already and would not be getting private-pay homecare. The subsidy might help stay-at-home family caregivers, however.
Similarly, the tax-free dependent savings accounts would mostly benefit the highest income households—both because the deduction is worth more to them and because they are more likely to have the disposable income to put into a savings account.
While Clinton is also targeting family caregivers, her plan is modest and aimed much more to middle-income households. She’d provide a 20 percent tax credit for the first $6,000 of caregiving costs. Unlike Trump’s deduction, her maximum credit would be worth the same $1,200 to all taxpayers. She’d also give Social Security work credit to those who stay home to care for aging parents, provide respite support, and improve training and pay for paid aides.
Despite the differences in these plans, and their problems, the real news here is that family caregiving has made it to the presidential campaign. That doesn’t assure that Congress would do anything to support caregivers in the coming years, but it does make it somewhat more likely.
When you realize that care for parents in a nursing home can easily range from $5,000 to $10,000 a month it makes the amounts these candidates are talking about seem like chump change. Exactly how is deductions of $5,000 or contributions of $2,000 a year supposed to get anyone interested let alone excited? Whoop de doo?
Perhaps we just need to take a page from the Eskimos and put our elderly on proverbial “ice floes” and let them float out into the sea never to be heard from again? Or strip them of all identification and leave them on a downtown street corner with only underwear and a blanket and hope they will be taken care of by someone?