Suzanne Mintz, writing in her 2007 book, A Family Caregiver Speaks Up, says, “One of the things that frustrates family caregivers more than others is the fact that they are left on their own to wade through a patchwork sea of disparate programs that may not be open to them or meet their needs. Everyone working in the field of caregiving agrees that our system of social supports is hopelessly fragmented and insufficient.
Family caregivers need the mental acuity and passionate perseverance of a Sherlock Holmes to even solve one part of their support needs puzzle. Even medical and social service professionals have trouble finding what they need when caregiving turns personal.”
That’s the unfortunate picture: ALS is hard enough to deal with, but on top of that there’s a confused tangle of red tape. The information and resources listed here can help sort out some of that confusion.
In addition to looking into what major government programs and health insurance may provide, the person with ALS should consider these ways to maintain income or acquire other funds (see Resources for more details about each of these):
“I pulled all the equity out of my house, we have practically depleted his 401k, have $80,000 in credit card debt and he is still alive and thriving. Believe me, I would do it all again. I am running out of resources. I thought of selling the house but it is worth about what I owe.”
Also deductible are “impairment-related work expenses,” which are disability adaptations and services that enable a person to continue working (see IRS Publication 907). This can include special computer programs and technological adaptations, hired work assistants and, sometimes, personal assistance at home for getting dressed and ready for work. The standards for claiming impairment-related work costs are less stringent than for medical deductions. If the device or service is “helpful and appropriate,” the deduction often qualifies. Keep receipts!
People with disabilities may, under certain circumstances, receive a tax credit for child and dependent care expenses (see IRS Publication 503) or qualify for the Credit for the Elderly or Disabled (see IRS Publication 524).
By the way, if the person with ALS is no longer able to sign his or her name, the caregiver will have to do that. For official documents such as tax returns, you’ll need to show a power of attorney form that gives you authority to sign for your loved one.
A home equity loan (second mortgage) can serve this purpose and also be used for ordinary expenses. Some families advise getting an equity line of credit or home equity loan for the maximum amount, just to have funds available. This provides funds but, of course, must be repaid. It’s best to apply for these loans while at least one spouse is still employed full time.
Be aware that some long-term disability policies will reduce the benefit if the person with ALS, his or her spouse, or children are receiving other benefits such as Social Security. Read the fine print!
|“Keep all papers on out-of-pocket expenses. This includes home improvements, showers, special toilets, ramps, hand rails, lifts on vans, etc. All this is deductible for IRS and state tax over a certain amount. So keep that shoebox handy to keep your records of what you pay out. We did this for 20 years with my husband’s care and it never was questioned by IRS or the state.”|
Some life insurance policies have disability waivers, which suspend payment of premiums as long as the person is disabled but keep the policy in force. That policy can be used as collateral in a loan application.
Taking cash from a life insurance policy before death will lessen its eventual value; decide whether that loss to the beneficiary is a good tradeoff for cash to help cover ALS expenses.
Below are other sources of financial support. Consult an elder law attorney or a trusted financial adviser acquainted with disability issues before making any major financial decisions.
It’s All in the Plan — How to start long-term financial planning, MDA/ALS Newsmagazine, October 2007
Financial Aid for the Disabled and Their Families 2010-2012, by Gail Ann Schlachter and R. David Weber, Reference Service Press, 2010
Plan While You Can: Legal Solutions for Facing Disability, by Roger W. Anderson, AuthorHouse, 2003
The Cost of Caring: Money Skills for Caregivers, by Anne M. Johnson and Ruth Rejnis, Wiley, 1998
Information and Referral, 211.org
Modest Needs, (212) 463-7042. Offers self-sufficiency, back to work, and independent living/quality of life grants
Ride for Life, respite grants and legal grants for people with ALS
A Consumer Guide to Handling Disputes with Your Employer or Private Health Plan, by the Kaiser Family Foundation and the Center for Consumers Health Choices at Consumers Union, 2005
COBRA (Consolidated Omnibus Budget Reconciliation Act), (866) 4-USA-DOL. Federal law provides certain former employees, retirees, spouses, former spouses and dependent children the right to temporary continuation of health coverage at group rates.
Timely Tips To Help Limit Your Tax Liability, MDA/ALS Newsmagazine, January 2008
ALS Expenses Can Be Tax Deductible, MDA/ALS Newsmagazine, January 2004
Internal Revenue Service, (800) 829-1040
Publication 501: Exemptions, Standard Deduction, and Filing Information
Publication 502: Medical and Dental Expenses
Publication 503: Child and Dependent Care Expenses
Publication 524: Credit for the Elderly or Disabled
Publication 525: Impairment-Related Work Expenses
Publication 529: Miscellaneous Deductions
Publication 596: Earned Income Credit
Publication 907: Tax Highlights for Persons with Disabilities
Publication 910: Guide to Free Tax Services
Publication 3966: Living and Working with Disabilities/Tax Benefits and Credits
Reverse Mortgages: Money from Home, MDA/ALS Newsmagazine, February 2006
AARP, (800) 209-8085
National Center for Home Equity Conversion, (800) 976-6211
National Reverse Mortgage Lenders Association, (866) 264-4466
U.S. Department of Housing and Urban Development, (800) 569-4287. Search “reverse mortgage” for selection of information.
Home modification loans
InfoQuest Spring 2011: Assistive Tech and Home Modification Funding, Quest, April-June 2011
Section 8 Made Simple, by Ann O’Hara and Emily Cooper, Technical Assistance Collaborative, 2003
American Council of Life Insurers, (202) 624-2000
Viatical and Life Settlements Consumer Info
Viatical and Life Settlement Association of America, (202) 367-1136
Also check with your state’s attorney general, office of consumer protection, insurance commissioner or department of insurance.