Safe Haven: Strategies to keep an elder parent in a private home during the Covid19 crisis

It is a particularly cruel fact of the Covid19 virus that it impacts most severely the elder generation that built the foundation of Canada. Not surprisingly, many adult children that have become caregivers of their elder parents are seeking strategies to keep their mothers and fathers safe.  

The great efforts of hard-working staff at assisted living and residential care homes to implement safety plans to protect residents have been exemplary.  However, these environments remain higher risk than the safety of a private home where the possibility of viral infection can minimized.  Given the high rates of required hospitalizations and poor overall outcomes, good financial advice focused around the particular pandemic related needs of the elderly can literally be a lifesaver.

Most adult children with an ailing elder parent seek such protections.  However, many are precluded from taking these protective steps due to financial costs with keeping an elder parent in their own home or the adult child’s residence.  Private in-home nursing assistance from care provider companies can be prohibitively expensive.  As well home renovation and special adaptations (walk in baths/showers, wheelchair ramps, safety devices…) can be costly. While there is some tax relief around caring for an elderly parent, it usually covers only a small portion of the cost.  That financial support can be greatly enhanced by applying for further government support through income tax credits and deductions.

DTS convened a task force to look at avenues to assess tax and benefit programs in coordination with BC health system programs.   We were shocked at how many claimable expenses and credits were being overlooked even by clients who had competent tax representation in elder tax filings. A tax professional can only do so much if they don’t have full information and few have training that considers implications on how tax matters interact with the health care system. Clients working with DTS will be asked to fill out an extensive questionnaire to try and locate every viable claimable expense, including interfamily transfers where an elder parent passes along tax credits they do not have enough retirement income to use.

In our review we found many years where thousands of dollars in tax savings were lost due to tax professionals not being aware of potential credits, claimable expenses, inter-family transfers, etc. In some cases we were able to adjust past tax filings to recover these lost resources; but in many cases, we could not, due to an inability to locate supporting documentation (medical receipts, attendant care, paper work, medical reports). 

In addition, we were surprised at how many people were paying health-related expenses out of their own pocket that were eligible for government subsidies or even payment in full.  We found examples that ran to tens to hundreds of thousands of dollars at the cost of the future estate for beneficiaries. 

Unfortunately, during the emotional years of caring for an elderly parent many of whom have multiple health issues, it’s very hard for an overwhelmed adult son or daughter to gain all of the important information to protect a parent’s assets and avoid private payment of reimbursable expenses. And now we are all dealing with the additional stress of Covid19: an invisible highly infective virus that is most dangerous to the elderly.

DTS is launching a division to coordinate tax planning and related health care provisions.  Please note: this division will only apply to BC residents.

Our hope is that the knowledge and expertise we can provide will ensure our clients find all eligible supports.  Where it is a family’s decision that the safest option for their parents through this Covid19 crisis is to stay at home or some other option, DTS can likely provide the resources to make that happen and potentially extend a quality of life for the better.

While DTS will provide direct advice only on tax matters, where we spot health expenses being paid that we know are potential are eligible for government subsidies or payment in full, DTS will alert clients to pursue professional advice to utilize such programs.  As well, we are aware of lawyers and other professionals who are quite knowledgeable in the important matters of power of attorney, wills, and can provide a list of names for clients to find suitable legal support.

If you are seeking to ensure all tax-based resources are being accessed to keep your elder parent in the safest home environment, please contact us for a free initial phone consultation at 604-415-5311.

Mike Campagne CFP, BA **

** The views and content are those of the author and the article is not to be construed as financial advice, but rather as general information.  Please contact your health care provider to determine specific potential government health care supports to you or family members.  Always consult a tax professional in determining the optimal way for you to file your 2020 tax return in regard to relevant tax credits and deductions.  Due to the differences in provincial health care rules and regulations, DTS serves elderly clients only in British Columbia.