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Accounting Information > IRS Tax Forms > Schedule R Credit for the Elderly or Disabled

Schedule R - Credit for the Elderly or Disabled

         When filing your income tax return, any tax credits you can claim will directly reduce your tax liability.  One such credit that is available to many taxpayers is the Credit for the Elderly or Disabled.  In order to claim this credit on your income tax return, you must complete Schedule R and attach it to your return when filing.

      For the purposes of this tax credit, elderly is defined as age 65 or over.  For the filing of your 2007 return, you must be 65 on or before January 1, 2008.


       To be considered disabled in regards to claiming this tax credit, you must not yet be age 65, have retired before the end of the year due to total and permanent disability, and received taxable disability income during the year.  Any payments received after reaching mandatory retirement age would not be considered qualifying disability income.  To be considered permanently and totally disabled, you must have been determined to be unable to be gainfully employed due to a medically determined physical or mental deficiency that has continued or can be expected to continue for a continuous period of twelve months or more.  A physician’s certification of your disability is required for the first year that the credit is claimed.  Normally, it is not required for subsequent years.

        If your Social Security benefits or your adjusted gross income are over the determined amount, or if you have a zero tax liability, you cannot claim the credit, even though you meet the requirements listed above.  Another restriction is that if you were a nonresident alien for any period during the year, you will not be able to claim the credit, unless you are married to a citizen or resident and have made the election to be treated as a resident. 

   You will not be able to file Form 1040EZ if you claim the credit for the elderly or disabled.  In order to claim the credit, you must file either Form 1040 or Form 1040A.  If using Form 1040A, the credit would be taken on Part 3.  On Form 1040, the credit is claimed using Schedule R.  This credit is not refundable.  This means that the credit amount is allowed only up to the amount of your determined tax liability. 

         This credit can be claimed by a married couple only if they file jointly.  The only exception to this is if the husband and wife have not lived together at all during the year and file separately.  In this case, they could claim the credit on separate returns.

        The amount of the credit that can be claimed is 15% of the base amount, which is reduced for non-taxable Social Security, as well as other tax-free pensions.  The base amount is also reduced by adjusted gross income which exceeds the stated limits.    

        If you are looking for a CPA or Accounting Firm to assist you with your income tax reporting, bookkeeping, financial planning, or general accounting needs, then you have come to the right place!  Try out the CPA Search feature on this website to find a qualified professional in your area.


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