Tax Resources

Who can claim Tax Credit for the Disabled?

The IRS allows tax credits for the elderly and tax credits for the disabled but not every disabled individuals can claim the tax credit for the disabled. So, who can claim tax credit for the disabled? Below is information on who can claim the tax credit for the disabled.

If you are qualified to claim tax credit for the disabled, you can claim it on the IRS tax form 1040 on the line that says ' credit for the elderly or the disabled '.

Who qualifies to claim tax credit for the disabled?

The qualification for tax credit for the disabled is similar to the qualification for tax credit for the elderly. If you are over 65 by the end of the tax year, you don't even have to be disabled to qualify for this credit. However, if a taxpayer is over 65 years old by the end of the previous tax year, then  he or she can qualify for the disabled tax credit if:

  • he or she is retired on permanent and total disability or he or she was permanently and totally disabled when he or she retired
  • he or she has taxable disability income and
  • he or she did not reach mandatory retirement age before the next tax year began.

If a taxpayer meets the test for disability tax credit above, he or she needs to be a US citizen or US resident for the entire tax year as well as meet the income test as outlined in the Elderly tax credit section.

What is the meaning of permanently and totally disabled?

A taxpayer is considered permanently and totally disabled if he or she cannot engage in any substantial gainful activity because of his or her physical or mental condition. Substantial gainful activity is the performance of significant duties over a reasonable period of time while working for pay or in work generally done for pay.

Does a physician have to certify my disability?

Yes. A physician has to certify that the taxpayer was totally and permanently disabled on the day he or she retired. The taxpayer must keep this statement for his or her record in case of an IRS inquiry or an IRS audit.

What is taxable disability income?

Taxable disability income must meet the following two requirements:

  1. the income must be paid under the taxpayer's employer's accident, health plan or pension plan
  2. the income must be included as wages for the time the taxpayer is absent from work because of the permanent and total disability.

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