Proposed family caregiver credit would recognize Mainers for millions of hours of unpaid labor

Maine’s patchwork system of professional caregivers is inadequate to meet the needs of every resident with long-term care needs. To fill these needs, Mainers step up to care for elderly and disabled adult family members and devote countless hours to caring for their loved ones. In 2017, roughly 181,000 Maine family caregivers provided more than 152 million hours of uncompensated care to family members age 18 and older.1

The Legislature’s Taxation Committee held a public hearing today on LD 1919, a bill by Rep. Kristen Cloutier of Lewiston, to create the Rep. Ann E. Peoples Family Caregiver Credit. MECEP supports the bill and its efforts to recognize and reward the hard work family caregivers do and the value it brings to Maine’s economy.

Click here for MECEP’s Fact Sheet on LD 1919.

Family caregivers often face greater difficulty making ends meet because of their caregiving duties. Research shows family caregivers are more likely to reduce hours, quit a job, retire early,2 and delay a job search because of caregiving responsibilities.3 A September 2019 survey by MECEP indicated that 14 percent of private-sector workers in Maine had quit their jobs or reduced their hours for more than two weeks in order to provide care for a loved one.4

These challenges don’t only lead to reduced income. Family caregivers can also see reductions in retirement security and benefits, such as health insurance. One study estimates that caregivers age 50 and older who leave the workforce to care for a parent lose an average of $303,000 in income, retirement savings, and benefits. Women are more likely to take on care responsibilities,5 and therefore more likely to suffer the financial repercussions of unpaid caregiving.

The Rep. Ann E. Peoples Family Caregiver Credit established by LD 1919 would provide a refundable Maine income tax credit of up to $2,000 for low- to moderate-income households that provide at least 150 hours of unpaid care to eligible family members annually. The credit would be available to single filers with annual incomes up to $75,000 and married joint filers with annual incomes up to $150,000, with the credit phasing out as incomes increase. Because the credit would be refundable, it would cause most eligible families with low incomes to receive a larger cash refund when they file their state income taxes.

As Maine is working to address its long-term care workforce needs, the important work of family caregivers should not go unnoticed. These Mainers contribute an invaluable service to their loved ones and out economy. The Rep. Ann E. Peoples Family Caregiver Credit is a step toward recognizing that hard work.

End Notes:

1 While this figure represents the most recent estimate of total family caregivers in Maine, some of those would be ineligible for the credit as described in LD 1919, either as a result of income or the type of care provided. More specific data to determine eligibility is not available. Reinhard, Susan C., et. al. “Valuing the Invaluable: 2019 Update.” AARP. November 2019.

2 MetLife. “The MetLife Study of Caregiving Costs to Working Caregivers.” June 2011.

3 Vega, William A., Maria P. Aranda, and Fancisca S. Rodriguez. “Millennials and Dementia Caregiving in the United States.”USC Suzanne Dworak-Peck School of Social Work. December 4, 2017.

4 Myall, James, and Mario Moretto. “State of Working Maine 2019.” Maine Center for Economic Policy. December 18, 2019.

5 MetLife. “The MetLife Study of Caregiving Costs to Working Caregivers.” June 2011.