Tax Season and Aging Parents: Forms to Help You File, Hidden Deductions

By Susan Chaityn Lebovits

Much of the stress I see from my clients is not about doing the actual taxes, but about getting access to information and not knowing what can and cannot be written off.

Power of Attorney (POA), while very critical, is not a Key to the Kingdom. In fact, having POA will not give you access to Social Security earnings or information in your parent’s Medicare account. When helping your parent file their taxes, here’s what you need to know:

Accessing Social Security: It’s Not Automatic

If your parent receives benefits, you’ll need their SSA-1099.

If they are able to log in and you can gain access, that’s the easy version.

But when they can’t—and this is where many families get stuck—you cannot simply step in and access their account as you may have been able to in years past.
You may need to apply to become their Representative Payee through the Social Security Administration. And this is where a critical form called the SSA-787 comes into play.
The SSA-787 is the Physician’s/Medical Officer’s Statement of Patient Capability to Manage Benefits. This form is completed by your parent’s doctor, confirms that your parent is no longer able to manage their finances, and is required as part of the Representative Payee application. Without it, the process can stall.
If you are in a time crunch, you can try to bring this form with you IN PERSON to a Social Security office. The office DOES NOT need to be in the city where your parent resides.

Legal Authority Matters
Even with Social Security access, you most likely will still need to have Financial Power of Attorney to speak with accountants, banks, and insurers (which a POA will allow access to). Keep in mind, these are all separate systems. One does not replace the other.

Deduction of Medical Expenses:
Many adult children miss this.
You can deduct medical expenses—but only the portion that exceeds 7.5% of your parent’s adjusted gross income (AGI).

What counts:

• Medicare premiums (Part B, Part D, supplemental plans)
• Out-of-pocket medical and dental care
• Prescription medications
• Long-term care services
• In some cases, home care or assisted living (if primarily medical)

What I often see is families scrambling because no one has kept track. If this is you, file for an extension so your family does not miss out.

Medical Records: Keep It Simple but Consistent
You do not need perfection. You need:

• Annual totals
• Receipts for larger expenses
• Insurance summaries

This becomes especially important if care is increasing or changing.

Timing Matters

• If your parent is starting to decline cognitively, do not wait.
• Set up access ASAP
• Speak with their doctor if capacity is becoming a concern
• Begin paperwork early (especially anything involving Social Security)

Final Thought
There’s a quiet shift that happens when you begin handling a parent’s finances. It’s not just logistical—it’s emotional.
You’re stepping into a role your parent once held for you.
The goal isn’t to do everything perfectly. It’s to remove obstacles so you can help them with clarity and create less stress for all of you. 

 Here is a Tax Prep Checklist to Download to help you keep track.

 Need help? We are here. Reach out now. Info@EaseIntoAging.com