If you are providing financial support for your aging parents, you may qualify to claim an exemption for them as a dependent on your tax return. The exemption allows eligible taxpayers to deduct up to $4,050 for each dependent claimed on their 2016 tax return.
For your parents to qualify as your dependent, in most cases they must have less gross income for the tax year than the exemption amount. (Exceptions may apply if your parent is permanently and totally disabled). Generally, their Social Security benefit is excluded from this income limitation, but income from dividends, interest, and retirement plans are included.
Also, you must have contributed more than 50% of your parent’s total financial support. If you shared caregiving duties with a sibling and your combined support exceeded 50%, you can claim the exemption even though no one individually provided more than 50%. However, only one of you can claim the exemption.