Tax Credits and BenefitsAs a person with a disability, you may qualify for some tax deductions, income exclusions, and tax credits. Certain disability-related payments may be excluded from gross income. These include compensatory damages for a physical injury or sick-ness; a permanent loss, or the loss of the use, of a part or function of your body; or a permanent disfigurement. Veterans Administration (VA) disability benefits and Supplemental Security Income (SSI) may also be excluded from your gross income. Also, if you have a physical or mental disability that limits your ability to function as an employee, you may be able to deduct as a miscellaneous deduction some of your work expenses related to your impairment. Some examples would be an on-the-job attendant, a screen reader, or a sign language interpreter.
You may be able to deduct home improvements and additions that are added primarily for medical care. The cost of certain educational services and equipment as medical expenses are also allowable, as long as these expenses are made to alleviate your physical or mental condition. Examples of potentially qualifying improvements are the installation of ramps or an elevator; the extra costs for Braille books over regular printed editions; or amounts paid to purchase, train, and maintain a dog or other service animal for assisting blind, deaf, or physically disabled individuals.
You may be entitled to the credit for the elderly or disabled if you are
- 65 or older, or
- If you were under 65 at the end of the calendar year, – Permanently and totally disabled, and – You received taxable disability income, and – You have not reached mandatory retirement age.
Special assistance is available for persons with disabilities. If you are unable to complete your return because of a physical disability, you may obtain assistance from an IRS office, or Volunteer Income Tax Assistance Program (VITA) sponsored by IRS. The VITA Program offers free tax help to low- to moderate-income ($38,000 and below) people who cannot prepare their own tax returns. Volunteers sponsored by various organizations receive training to help prepare basic tax returns in communities across the country. VITA sites are generally located at community and neighborhood centers, libraries, schools, shopping malls, and other convenient locations. Most locations also offer free electronic filing. To locate the nearest VITA site, call 1-800-829-1040.
Additional information on tax credits and benefits can be found at the Internal Revenue Service website at: www.irs.gov