A tax break, and raising the exemption would be a wonderful break. You would in the long run, not make us dependents in the future. God bless you for thinking of old age. Respectfully, Senator GEORGE SMATHERS, Washington, D.C. LUCY MORELL. NEW YORK, N.Y., June 16, 1966. DEAR SIR: I read in the newspapers about the Senate hearing being held on the Federal tax laws in regards to aged parents. In my case, being a single woman in my 40's, I live with my parents who are in their middle 70's. They have no income other than Social Security benefits. I have been claiming my parents as my dependents since my fathers retirement, about 10 years ago. Now for my 1964 income tax report, I was informed that I will not be allowed these dependents. They claim I do not make enough money or spend enough on them, according to their charts, to earn these deductions. I would certainly like to be able to live by myself in my own apartment, and my parents would like to live by themselves, but our separate income does not provide for this luxury. Therefore, by living together and pooling our incomes we can manage sufficiently. Now I have this added problem of being unable to claim my parents as my dependents. The questions they ask as to how much of my income is used to support my parents is certainly unfair. There is more to running a home than supplying food, board, clothing and medical expenses. Perhaps if some special attention were given to this matter, there would be better relations between children and aged parents, and perhaps some people would be dropped off the welfare rolls. I hope this letter will help in your hearings to help improve the tax structure for aged parents, and their children. Very truly yours, (Miss) B. SCHWARTZ. (An additional letter from New York appears in appendix A, on p. 37.) NORTH CAROLINA (Two letters from North Carolina appear in appendix B, on pp. and 43.) 40 OHIO JUNE 2, 1966. DEAR SENATOR: The Prentice-Hall Federal Taxes Report Bulletin in Paragraph 60,233, Volume 6, reported that the Senate Special Committee On Aging is holding hearings to find ways to provide tax aid for children assisting in the support of their parents. The paragraph indicates that the committee is interested in receiving suggestions. As you know, Section 152 of the 1954 Internal Revenue Code provides that a taxpayer may claim an exemption for a dependent if two or more taxpayers provided more than one-half of the dependent's support. The problem your committee is concerned with is limited to cases in which the dependent parent receives more than one-half of his support either from income or from social security payments and pension payments. It appears to me that it would be equitable to provide a deduction to persons who contribute less than one-half the support of aged parents by including in a bill a minimum percentage of support, such as 10 percent as in Section 152, and also including a maximum income of the receiving parent. Legislation of this type should also include limitations similar to the limitations contained in Section 214 of the 1954 Internal Revenue Code which provides deductions to certain individuals for care of dependent children. It appears that the maximum deduction that should be allowed a person contributing to the support of a dependent parent should be the amount of the contribution, but should be no more than $600, the amount allowed as an exemption, and should probably be limited to $900 in the event two parents are supported by the same individual. The deduction should also be reduced as in Section 214 by the amount the contributing child's income exceeds a certain minimum, such as $6,000. In this manner the deduction will be limited to taxpayers in the lowest income group, the group most in need of this kind of help. If I can be of any further assistance to you please let me know. Very truly yours, [Name withheld.] JUNE 28, 1966. HON. SENATOR GEORGE A. SMATHERS: I read in our local newspaper where you were opening hearings on the problem of tax laws discouraging aid to aging parents. I seem to be one of those involved in the support of my 83-year-old mother as I am not allowed to claim her because of her tax free Social Security $64. I owe her more than I could ever repay, therefore, she lives here without payments to me, I wouldn't think of putting her in a rest home and I doubt very much if there is one in the entire country that would feed, clothe, pay doctor bills and buy medicine on her Social Security money. This money is hers to do with as she wishes, presents for relatives, insurance, bus fare, etc. This is in protest against the unfairness of the present tax Statutes concerning aging parents. Sincerely, [Name withheld.] PENNSYLVANIA MAY 21, 1966. DEAR SIR: Via T.V. news we hear you are interested in hearing about "parent support." Briefly my dad 85 and my mother 82 receive $66.00 per mo. SS. that will go down to $60 in July. They live in a four room, old house; with a coal furnace and city water. no other modern fixtures. They are neat and clean and quite happy as my husband gives them $85 to $90 each month to live on. They have no other income. Both have $1600 life insurance which we pay for burial. Nothing else in the way of income. They do own the house which is assessed for $800.00. We carry them as dependents as we must. My parents would die if they had to go on relief. We have no family and gladly support them. They want to live here as long as they can care for themselves. My gripe is this: We must count the rental on this house as part of their income. I've had to explain to the tax accountants why this home could not rent unless you found two old people who would live as my parents do. They know we could not afford to pay rent for an apartment. Do eliminate the fair rental value of a home as income. Each year I make out a sheet showing exactly how my folks use their money. I also explain in detail any health changes. Mother had to be hospitalized for 3 weeks. We paid the Doctor bill, Kerr Mills paid her hospital bill, but took $32.00 from her towards the hospital bill. This $32.00 was received from the local fraternal lodge that will give the old members up to $75 per year if they are ill. I wanted this money used for Doctor bills but was refused. Kerr Mills caseworker wanted us to borrow on her life insurance policy-we refused as we would have an additional burden of paying this back. They did finally approve the hospital bill. Thank God for medicare in July. Each old, proud person worries about bills. Let us: 1. Eliminate House Rental Value as Income. No cash involved here. 2. Have more simple records of spending of the old. 3. Permit us to carry them as dependents above $600 income. My parents could not exist on less then we now give them. If each got $600 that would not take care of food and staples. 4. Most of us are honest in our tax returns. Check us yes, but do not harass us. I've been told that my dad would have to go off our tax deduction if S.S. should go up. It has even been suggested that $480.00 per year was not a bad income. Lastly: The local tax office has not called me in to explain the last two years, but I expect to be called again. I sincerely hope that medicare will not be counted as income in the event one or the other is ill. We will always help our parents even without tax deduction, but I'm happy you care enough to ask for letters. * Respectfully, [Name withheld.] DEAR SENATOR SMATHERS: Please read my letter if you are genuinely concerned about tax laws and their effect on children who try to support their parents. I became sole support of the family in summer of 1937 when father had a heart attack. He was not covered by pension or annuity and family illness (sisters on both sides) had used up everything they had tried to save. Father lived until February 1943 (aged 69). I thank God I was able to meet all bills. Mother was taken ill in 1946. She had no income at all. Here again there were heavy bills for medicine, doctor, operation. Through the years I managed (on a minister's salary) to take care of her by cashing in two insurance policies to pay for an operation in 1953, and by using up most of my savings. Then September 17, 1964 mother broke her hip. I was able with Blue Cross-Blue Shield aid, plus selling everything I could, including a stamp collection, to pay all the bills until her discharge from the hospital (unable to walk). I was down to just $330.00. I had investigated nursing homes. They were $75.00 a week and up (even the low figure was more than half of what I make a week). Then I tried to get someone to come in daily as I have to leave the house before 8 a.m. and do not get home until nearly 6 p.m. These were not even practical nurses and they wanted more than I earn a week. I went to see about Kerr-Mills and the girl's first question was "what do you have to sell?" I was at the "end of my rope." At that point, God answered prayer, and the Masons invited mother to become a member of their family at the Masonic Home in another state where my father had been a life member. She is now 86 years old, and absolutely helpless. I get to see her but very seldom due to the cost and the fact that I must work. (I do not have a car). I am only thankful I could take care of my parents as long as I did. I wish I could have continued to do so for mother. It would have been a great help if there could have been a $1,200.00 de duction allowed when they were 65. It would have helped if all medical and dental bills could have been deducted. Medicine was at least $30.00 a month for mother from 1953 on. Twice I wrote to the Senator who was chairman of the tax hearings. Each time I received a letter that it didn't cost me anything as I had a place for mother anyway. I do not have a parsonage. I never have had. I have to rent living quarters and I sure wouldn't have a two bedroom one over these past years except to take care of mother. If someone comes to find out where I live now, I still have two bedrooms because I don't have the money it would cost to move to a smaller place and so far I haven't found anything that wouldn't cost more than where I am. To top it all off, the computer threw out my 1964 tax return, my deductions were "too big." So I had to prove I was sole support of my mother, how much of her clothing did I buy, what did I spend for it, how much for her food, send every hospital, doctor, druggist bill. I'm thankful I had 98 percent of expenditures covered by check and they finally accepted my return. Thanks for reading this. I plead with you for help to other unmarried (and married) children who are trying to care for their parents and do not want to put them on relief. Sincerely, [Name withheld.] (Another letter from Pennsylvania appears in appendix B, on p. 41.) TENNESSEE MAY 25, 1966. DEAR SENATOR SMATHERS: In our local morning paper, Memphis CommercialAppeal on May 19, was an article relating to this new tax bill hearings you are due to begin this week. I read the article several times, and I am in full agreement with this as some ideas the committee have been studying were printed. I have to support my mother in Arkansas-and the house there too-and in 1961 or 62-I forgot the exact year now-the IRS had me to drop her as an exemption-tho I still have the support and upkeep of her house as well as my house here. I therefore am unable to get anywhere ahead it seems. I carry hospitalization policy for her, house taxes, house insurance and in the recent past-put on a new roof, foundation, paint and some minor repairs too. I had to drop her-now 70 years old, 71 this coming September, due to her sharing her life with her sister. This sister (my Aunt) has to assist her in her handicap. I do not give 2 or more support to her as I have my house here. However, I do have the above mentioned things to pay. Perhaps it may be where in my case-possible many like me too-that we would be listed as Unmarried Head of Household to help on the tax load of the payers. Yours truly, OTIS R. HOLLOWAY, (Another letter from Tennessee appears in appendix B, on p. 44.) TEXAS (A letter from Texas appears in appendix B, on p. 48.) WASHINGTON (A letter from Washington apears in appendix B, on p. 42.) WISCONSIN (A letter from Wisconsin appears in appendix B, on p. 39.) APPENDIX D RESEARCH MATERIALS 1. Statistics on Receipt by Individuals Aged 65 and Over of Contributions From Persons Not in Their Homes NOTE. The following table based upon the Social Security Administration's 1963 Survey of the Aged appeared in an article by Erdman Palmore entitled "Differences in Sources and Size of Income Findings of the 1963 Survey of the Aged," p. 7, SOCIAL SECURITY BULLETIN, May 1965: 64 |