HB226 creates a new nonrefundable Kentucky individual income tax credit for eligible caregivers who pay unreimbursed expenses to provide in-home care for an eligible family member. The credit applies to taxable years beginning on or after January 1, 2026, and before January 1, 2030. Eligible family members must be at least 62 years old, require help with at least two activities of daily living, and be cared for by a relative by blood or marriage. Qualified expenses can include home care aides, respite care, adult day care, personal care attendants, health care equipment, home modifications, technology, and leased medical equipment.
The credit equals 50% of eligible expenses, capped at $2,000 per family member in most cases and $3,000 if the care recipient is a veteran or has dementia. Taxpayers with modified gross income above $100,000 are not eligible, and multiple caregivers cannot claim the same expenses. The bill also sets an annual statewide cap of $1.5 million in credits, requires the Department of Revenue to adjust the cap in later years if claims exceed the limit, and directs the department to publish remaining credit availability when the cap is adjusted. The department may require documentation and verification, including the family member’s Social Security number, and may adopt administrative regulations to administer the credit.
HB226 also amends Kentucky’s credit-ordering statute, KRS 141.0205, to place the new caregiver credit in the sequence of nonrefundable individual income tax credits. In addition, it amends KRS 131.190 to allow the Department of Revenue to share certain taxpayer information with the Legislative Research Commission for reporting on the new credit. The reporting requirement includes county-level location, amounts claimed, total credits, and credit claims by income range, and the bill specifies that this information is not confidential taxpayer information for purposes of disclosure restrictions.
The overall sentiment reflected by the bill text is supportive of family caregiving and tax relief for people who bear out-of-pocket costs to care for older adults and certain higher-need family members. Because no committee transcripts or votes were provided, there is no recorded discussion or vote history here to indicate broader legislative support or opposition. The structure of the bill suggests an intent to target relief narrowly, with income limits, expense documentation, and a statewide cap to control fiscal exposure.
Potential points of contention are likely to center on the fiscal cost, the $1.5 million annual cap, and the administrative burden of verifying eligibility and expenses. The income cutoff, the requirement that the care recipient be at least 62 and need assistance with two activities of daily living, and the exclusion of unreimbursed expenses already claimed by another caregiver may also be debated as either necessary guardrails or too restrictive. Privacy concerns may arise from the bill’s authorization to collect and report detailed taxpayer information, including county and income-range data, and to require the family member’s Social Security number for verification.
HB226 would add a new nonrefundable individual income tax credit to Kentucky law and integrate it into the state’s credit-priority rules under KRS 141.0205. It would also expand the Department of Revenue’s reporting authority under KRS 131.190 for legislative oversight of the credit. The bill affects individual taxpayers who provide in-home care to qualifying older or disabled family members, as well as the Department of Revenue, which would administer, verify, cap, and report on the credit.
Based on the bill’s design, the measure appears generally favorable toward family caregivers and older adults needing in-home assistance, offering targeted tax relief for unreimbursed care costs. No committee testimony or vote record was provided, so there is no direct evidence of formal support or opposition from legislators in the available materials. The bill’s narrow eligibility rules and annual cap suggest an effort to balance caregiver assistance with fiscal restraint.
Likely areas of contention include the cost to the state, the adequacy of the $1.5 million annual cap, and whether the credit is too limited by the $100,000 income threshold and the age/functional-need requirements for the care recipient. Some may question whether the credit should be refundable rather than nonrefundable, while others may object to the documentation and disclosure provisions, including the use of Social Security numbers and the public reporting of nonconfidential credit data. The bill’s restrictions on multiple caregivers claiming the same expenses could also be a practical issue for families sharing caregiving responsibilities.