Who Qualifies for the Credit?

In order to qualify for the tax credit for the elderly or disabled, you must be a U.S. citizen or resident, you must be either age 65 or older or totally and permanently disabled, and your income must be below a certain limit based on your filing status for tax purposes.

Age 65 or Older

For tax purposes, you are considered to be age 65 on the day before your 65th birthday.  So if you reach age 65 on January 1st, you are considered age 65 for the preceding tax year if you report on a calendar-year basis.

Disabled

If you are under age 65, you can qualify for this credit if you retired on total and permanent disability before reaching the minimum retirement age set by your employer.  Also, in order to claim the credit, you must have disability income.  Even if you did not formally retire, you are considered to be retired if you stopped working because of your disability.

Being totally and permanently disabled means that you are unable to engage in any substantial gainful activity because of your physical or mental condition.  You must have a physician’s certification that your condition has lasted, or can be expected to last 12 continuous months or more, or that the condition can lead to death.  Being engaged in a substantial gainful activity means performing significant duties over a reasonable period of time while working for pay or profit, or doing work that is normally done for pay.  Working full-time or part-time in a competitive environment for at least the minimum wage would be proof of your ability to engage in a substantial gainful activity.

Substantial gainful activity does not include taking care of yourself at home, unpaid work you perform as a hobby or in social programs, therapy, training or education.  It must be work you perform for pay.  The fact that you have not worked for a period of time does not necessarily demonstrate that you cannot engage in substantial gainful activity.  And if you retire on disability from one job and then take another job, you may not be considered permanently and totally disabled for purposes of this credit.  The amount of income you earn is not necessarily a factor, but the work you perform must be productive work and not make-work in order for it to be considered a substantial activity.  Working full-time as a volunteer may show that you are not disabled if the work you perform would be for pay under other circumstances.  But working a few hours a day, at your convenience and when you feel capable, will not disqualify you from being considered disabled for purposes of this credit.