Service member filling out financial paperwork.

Tax Breaks for Families with Special Needs

If you are filing taxes on behalf of yourself or a family member with special needs, you may be eligible for certain tax breaks.

Tax-filing tips

Here are some tips for military families with members who have special needs:

  • Claim all eligible dependents — If you have a family member who is permanently and totally disabled, you may be able to claim him or her as a dependent regardless of age. Read IRS Publication 501.
  • Explore adoption credit — If you have adopted a child with special needs, you may be eligible for a credit. You may also be able to exclude employer-provided adoption benefits from your income. See IRS Tax Topic 607.
  • Try to recoup child and dependent care expenses — If you pay for child or dependent care so you can work or look for work, you may be eligible for a credit of up to 35 percent of your expenses. Care of children under age 13 qualifies, as does paid care of a spouse or other dependent who is not able to care for himself or herself. Read IRS Publication 503.
  • Explore the Earned Income Tax Credit — You may be eligible for the Earned Income Tax Credit on behalf of a family member who is permanently and totally disabled. This includes your son, daughter, adopted child, stepchild, foster child, brother, sister, stepbrother, stepsister, half-brother, half-sister or their descendant. See IRS Publication 596.
  • Explore the Credit for the Elderly or the Disabled — If you or a family member are retired, on permanent and total disability, and under age 65, you may qualify for the Credit for the Elderly or the Disabled. You can take the credit only if you file Form 1040 or 1040A. Read IRS Publication 524.
  • Find out whether you can claim medical and dental expenses — Depending on how much you spend on medical care, including equipment, supplies and diagnostic devices, you may be able to deduct a portion from your taxes. Read IRS Publication 502.

Educate yourself on the tax breaks you and your family may be eligible for. Through MilTax, Military OneSource provides year-round access to tax consultants who can help maximize your refund. You can also access special needs specialty consultations through Military OneSource by calling 800-342-9647.