H.R. 2036: Credit for Caring Act of 2025

The Credit for Caring Act of 2025 would create a new federal tax credit for people who work and also pay to care for a family member with significant long-term care needs. The credit would equal 30% of qualifying caregiving expenses above $2,000, with a maximum credit of $5,000 a year. In simple terms, it is aimed at families who are spending real money on care, equipment, transportation, home changes, and other supports that make daily life possible for a loved one.

The bill is targeted rather than universal. To qualify, a caregiver must have more than $7,500 in earned income, and the person receiving care must be a spouse or certain relatives with documented long-term care needs certified by a licensed health care practitioner. The bill also phases the credit out for higher-income households, starting at $150,000 for married couples filing jointly and $75,000 for other filers. That means the biggest help would go to low- and middle-income working families, not top earners.

What stands out is how broad the bill's definition of caregiving costs is. It goes beyond nursing or medical bills and includes respite care, support groups, caregiver training, some travel, assistive technology, home modifications, and even employer-verified lost wages for unpaid time off. That reflects the reality that family caregiving often involves many small and large costs that do not fit neatly into existing tax breaks.

The bill also tries to prevent double-dipping by reducing eligible expenses when families already use other tax benefits for the same costs, such as the dependent care credit, the medical expense deduction, flexible spending arrangements, health savings accounts, or ABLE-related tax advantages. Politically, the measure taps into a broad concern that the U.S. relies heavily on unpaid family caregivers while offering them limited direct support. The main debate is likely to be over cost, how easy the credit would be to claim, and whether a nonrefundable tax credit is enough for families under the most financial strain.