This bill adds a new category called "qualified family caregiver" to the tax rules that allow extra "catch-up" retirement contributions. A person qualifies if they did 500 or more hours of unpaid caregiving in a taxable year or a prior taxable year and did fewer than 500 hours of paid work in that same taxable year. The bill limits how many years a person can use this status to the lesser of the number of years they met the tests or five years total. It defines family caregiver to include unpaid family members, foster parents, or other unpaid adults who are unemployed or severely underemployed and who provide in-home care for a child or an adult with special needs, including elderly adults with age-related care needs. The bill lists examples of caregiving tasks that count (bathing, dressing, laundry, shopping or food prep, housekeeping, managing medications, transportation, mobility help). Employer retirement plans may rely on a written self-certification from the individual. The bill also extends the same caregiver catch-up rule to IRA catch-up contributions. The changes apply to taxable years beginning after December 31, 2026.
If you are an unpaid family caregiver and meet the bill's hours and paid-employment limits, you may be allowed to make additional catch-up contributions to employer retirement plans and IRAs. You must have done at least 500 hours of qualifying caregiving in a taxable year (or in one previous year) and have worked fewer than 500 hours for pay in that same taxable year. You can use the caregiver catch-up status for up to five years total (or fewer if you meet the test fewer times). Your plan can accept your written statement that you qualify. The rule starts for tax years after 2026.
No publicly available information on estimated federal costs or revenue effects is included in the bill text or metadata.
The bill text shows the sponsors aim to let unpaid family caregivers save more for retirement by allowing extra catch-up contributions when they meet the caregiving and employment tests.
No publicly available information on opponents' views is included in the bill text or metadata.