Vermont Ways & Means hears testimony on S.51 unpaid caregiver tax credit

The House Ways & Means Committee heard extended testimony on S.51, the Vermont Unpaid Caregiver Tax Credit, on Wednesday, April 16, with advocates urging lawmakers to clarify eligibility rules and keep the application simple to reach caregivers who would benefit most.

Advocates framed unpaid family caregivers as a critical but strained component of Vermont's long-term care system. Meg Polite, policy director for the Vermont chapter of the Alzheimer's Association, told the committee that dementia caregivers face greater time and financial burdens than other caregivers and that the bill would provide tangible recognition and relief. "S51 is just a really tangible way to provide the the much, much needed recognition to unpaid caregivers and slightly alleviate the overwhelming financial burden," Polite said.

Polite summarized data from the Vermont Department of Health and other sources in her written testimony: she said about 12,800 Vermonters were diagnosed with Alzheimer's in 2020 (a figure her testimony notes as a conservative count because about half of people with dementia are undiagnosed), and that last year roughly 20,000 Vermonters provided about 29,000,000 hours of unpaid dementia-related care valued at about $773,000,000. She said dementia caregiving commonly requires substantially more time over a prolonged period and that 1 in 4 dementia caregivers spend 40 hours or more per week on care.

Polite raised several points she asked the committee to consider when drafting eligibility language. She noted that the bill currently requires a formal diagnosis and assistance with activities of daily living (ADLs), and she warned that a diagnosis requirement could exclude many people who need support because roughly half of people living with dementia lack a formal diagnosis. She suggested the committee consider limiting the credit to those caring for adults rather than children ("you might wanna actually consider just making that change to the bill on, page 2, line 18"), and she recommended adding instrumental activities of daily living (IADLs) to eligibility criteria to better reflect the range of time-consuming tasks caregivers perform (for example, help with transportation, meal preparation, or remembering to eat).

Polite also relayed a testimony anecdote from an earlier event: "One person stood up and literally said, 'am I correct that this bill would provide me with a thousand dollar tax credit if I attest that I provided 10 40 hours of care? That's less than a dollar an hour.'" She and other witnesses said that even a $1,000 credit can be meaningful for lower- and middle-income households paying out-of-pocket costs or making home safety repairs. Polite noted the bill's projected state cost of roughly $6,000,000 and asked lawmakers to weigh that against the estimated $773 million value of unpaid dementia care to the state.

Colin Hilliard, advocacy director for AARP Vermont, said AARP supports the measure and highlighted AARP's state polling and valuation research. "We're very supportive of this unpaid caregiver tax credit," Hilliard said. He cited a 2023 AARP analysis that estimates about 70,000 family caregivers in Vermont providing roughly 66,000,000 hours of care annually with an estimated economic value of about $1.23 billion; he said many caregivers remain in the workforce while adjusting hours or taking reduced pay to provide care.

Mary Hayden, executive director of the Vermont Association of Area Agencies on Aging, described direct service gaps the state faces and emphasized the importance of respite. "We have something, a very modest state funded grant called the dementia respite grant, which has been at $250,000 for 20 years," Hayden said, adding that the statewide network of area agencies on aging serves roughly 400 caregivers per year through that program and related supports. Hayden urged that any state program be easy to access, because caregivers can be overwhelmed by paperwork and application steps.

Committee members asked about program design, overlap with federal tax provisions, and the best way to target relief. Representative Jared Kornheiser, chair of the committee, and other members pressed witnesses about the relationship between the state credit and federal deductions or credits; witnesses said many caregivers do not itemize federal deductions and that some federal provisions require documentation or receipts that could make access difficult for the intended population.

No formal action on S.51 was taken in the committee on April 16; the item received testimony and follow-up questions. Committee members signaled they would continue to review eligibility language, diagnosis requirements, and whether the credit should explicitly be limited to adult caregiving.

Votes at a glance from the same hearing: the committee later took up S.27 (medical debt relief) and found that bill favorable by roll call, 11-0 (see separate entry).