Table of Contents
If you qualify, you may be able to reduce the tax you owe by taking the credit for the elderly or the disabled on Schedule R (Form 1040A or 1040).
This chapter explains:
Who qualifies for the credit for the elderly or the disabled, and
How to claim the credit.
You may be able to take the credit for the elderly or the disabled if:
You are age 65 or older at the end of 2016, or
You retired on permanent and total disability and have taxable disability income.
524 Credit for the Elderly or the Disabled
554 Tax Guide for Seniors
Form (and Instructions)
Schedule R (Form 1040A or 1040) Credit for the Elderly or the Disabled
You can take the credit for the elderly or the disabled if you meet both of the following requirements.
You are a qualified individual.
Your income isn't more than certain limits.
You can use Figure 33-A and Table 33-1 as guides to see if you are eligible for the credit. Use Figure 33-A first to see if you are a qualified individual. If you are, go to Table 33-1 to make sure your income isn't too high to take the credit.
You are a qualified individual for this credit if you are a U.S. citizen or resident alien, and either of the following applies.
You were age 65 or older at the end of 2016.
You were under age 65 at the end of 2016 and all three of the following statements are true.
You retired on permanent and total disability (explained later).
You received taxable disability income for 2016.
On January 1, 2016, you had not reached mandatory retirement age (defined later under Disability income ).
You must be a U.S. citizen or resident alien (or be treated as a resident alien) to take the credit. Generally, you can't take the credit if you were a nonresident alien at any time during the tax year.
If you were a nonresident alien at the beginning of the year and a resident alien at the end of the year, and you were married to a U.S. citizen or resident alien at the end of the year, you may be able to choose to be treated as a U.S. resident alien for the entire year. In that case, you may be allowed to take the credit.
For information on these choices, see chapter 1 of Pub. 519, U.S. Tax Guide for Aliens.
Generally, if you are married at the end of the tax year, you and your spouse must file a joint return to take the credit. However, if you and your spouse didn't live in the same household at any time during the tax year, you can file either a joint return or separate returns and still take the credit.
If you are under age 65 at the end of 2016, you can qualify for the credit only if you are retired on permanent and total disability (discussed next) and have taxable disability income (discussed later under Disability income ). You are retired on permanent and total disability if:
You were permanently and totally disabled when you retired, and
You retired on disability before the close of the tax year.
Even if you don't retire formally, you may be considered retired on disability when you have stopped working because of your disability.
If you retired on disability before 1977, and weren't permanently and totally disabled at the time, you can qualify for the credit if you were permanently and totally disabled on January 1, 1976, or January 1, 1977.
Information on minimum wage rates is available on the Department of Labor's Wage and Hour Division webpage at www.dol.gov/general/topic/wages/minimumwage.
|IF your filing status is ...||THEN, even if you qualify (see Figure 33-A ), you CANNOT take the credit if...|
|Your adjusted gross income (AGI)* is equal to or more than...||OR the total of your nontaxable social security and other nontaxable pension(s), annuities, or disability income is equal to or more than...|
|single, head of household, or qualifying widow(er) with dependent child||$17,500||$5,000|
|married filing jointly and only one spouse qualifies in Figure 33-A||$20,000||$5,000|
|married filing jointly and both spouses qualify in Figure 33-A||$25,000||$7,500|
|married filing separately and you lived apart from your spouse for all of 2016||$12,500||$3,750|
|*AGI is the amount on Form 1040A, line 22, or Form 1040, line 38.|
It must be paid under your employer's accident or health plan or pension plan.
It must be included in your income as wages (or payments instead of wages) for the time you are absent from work because of permanent and total disability.
To determine if you can claim the credit, you must consider two income limits. The first limit is the amount of your adjusted gross income (AGI). The second limit is the amount of nontaxable social security and other nontaxable pensions, annuities, or disability income you received. The limits are shown in Table 33-1.
If your AGI and nontaxable pensions, annuities, or disability income are less than the income limits, you may be able to claim the credit. See How to Claim the Credit , later.
You can figure the credit yourself or the IRS will figure it for you. If you want to figure the credit yourself, skip to Credit Figured by You , later.
If you want the IRS to figure the credit for you, read the following discussion for the form you will file (Form 1040 or 1040A).
To figure the credit yourself, first check the box in Part I of Schedule R that applies to you. Only check one box in Part I. If you check box 2, 4, 5, 6, or 9 in Part I, also complete Part II of Schedule R.
Next, figure the amount of your credit using Part III of Schedule R. For a step-by-step discussion about filling out Part III of Schedule R, see Figuring the Credit Yourself in Pub. 524.
Finally, report the amount from line 22 of Schedule R on your tax return. If you file Form 1040A, enter the amount from Schedule R, line 22, on Form 1040A, line 32. If you file Form 1040, include the amount from Schedule R, line 22, on line 54; check box c, and enter “Sch R” on the line next to that box.
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