Written by a parent, not a doctor. Nothing here is medical advice.

Childhood Cancer Lantern
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Federal, exists in every state

Tax refunds and treatment-related deductions

Tax credits and treatment-related deductions can change what you owe or receive after a year of changing income.

What it is

Tax credits and treatment-related deductions can change what you owe or receive after a year of changing income.

Different annual earnings can move federal tax credits up or down. North Dakota also offers a Family Member Care Tax Credit with its own rules. A preparer can compare the credits and any deduction for high medical expenses.

Rules
  • North Dakota’s nonrefundable Family Member Care Tax Credit is generally 20%–30% of eligible unreimbursed care expenses paid to an unrelated provider, up to $2,000 for one qualifying relative and $4,000 total. The relative must be related by blood or marriage and age 65 or older or disabled under the statutory definition, with taxable income no more than $20,000, or $35,000 if married. The claimant’s taxable income changes the percentage and reduces the credit above $50,000, or $70,000 on a joint return; married-filing-separately amounts have special reductions. Expenses already used as a federal medical-expense deduction cannot also produce this state credit. A preparer must check the correct tax year and filing deadline; no refund or payment for a parent’s own unpaid care is promised.
  • For tax year 2026, the IRS medical mileage rate is 20.5 cents per mile for January through June and 23.5 cents for July through December. Only eligible unreimbursed medical expenses above 7.5% of adjusted gross income are deductible when itemizing. A preparer can compare that deduction with the North Dakota credit without counting the same expense twice.
  • Refundable federal credits require a filed return, including when no income tax is owed.
  • The North Dakota care credit cannot be carried back or forward to another tax year.
What you get
  • Federal credits, part of them refundable, paid on a filed return.
  • A possible North Dakota credit against state income tax for qualifying care expenses.
  • A possible medical-expense deduction when qualifying unreimbursed costs are high enough to itemize.
What to keep
  • Every bill, insurance statement, parking, mileage and lodging record for treatment trips, from now.
If you decide to apply
  1. Keep treatment receipts and mileage records.
  2. Ask a free tax-help service or qualified preparer to review federal credits, the medical deduction and the North Dakota care credit.

Tax preparer or free tax-help service; North Dakota Office of State Tax Commissioner · Official page ↗

Missed years
  • Earlier tax years can still be claimed; each has its own deadline.
  • Expenses from 2026 belong on the 2026 return, normally due April 15, 2027, subject to applicable extensions or relief. The normal 2025 return deadline was April 15, 2026.
Good to know

A credit, a refundable amount and a deduction are three different things; a preparer should check them before anyone promises a refund. Today’s benefit-screening income is not the tax-year figure.

Other details
  • For the North Dakota care credit, the rate starts at 30% through $25,000 taxable income, or $35,000 jointly. It falls one percentage point per $2,000 or fraction above that, to 20%. The credit falls dollar for dollar above $50,000, or $70,000 jointly. Married-filing-separately treatment has statutory half-size rules. A preparer checks the correct year’s Schedule ND-1FC and qualifying expenses.
Official sources
Ask your social worker

“Is there free tax help you recommend, and should we be keeping treatment receipts and mileage for a medical deduction?”

Why I’m asking: We want to claim any refund we are due in a year with different income and high bills.

More background and detailed requirements
Additional program information and published rules

Who does what

The three parts, side by side. The agency decides; nobody on this page does.

You

Keep the mileage log, parking and lodging receipts and every medical bill; file even in a year you owe nothing.

Your social worker

Points you to a free VITA tax site and, if a parent is paid by Medicaid for home care, to the paperwork that marks that pay as excludable.

The care team

Records and letters when the application asks for them.

Who decides
The IRS, on the return you file
Ask your social worker
“Is there a free tax help site for families here? If a parent is paid through Medicaid for our child's home care, what paperwork marks that pay as excludable?”

How to apply

First step: Start a mileage and lodging log now, keep every medical bill, and ask the social worker for the free VITA tax site near you.

  1. Start a mileage and lodging log the week of diagnosis.
  2. Ask HR about the dependent-care account when a sibling needs paid care so a parent can work.
  3. File even in a year with no tax owed; the child tax credit and earned income credit can still pay.

Where it starts: Federal tax return; free VITA tax sites for lower-income families

What to gather

  • A mileage log with dates and destinations
  • Parking, toll and lodging receipts
  • Every medical bill and the insurance statements showing what you paid
  • The employer's dependent-care account form, if offered

How long: Settled on the tax return for the year. A refund follows filing.

What a yes looks like

A smaller tax bill or a refund that reflects the deduction and the credits.

What a no looks like, and the next move

The standard deduction beats itemizing: the mileage and lodging are then unused, but the child tax credit and earned income credit still apply.

Watch out

  • Throwing away the mileage log. Hospital trips at 20.5 cents a mile (January to June 2026) and 23.5 cents (July to December), plus parking and tolls, add up over a treatment year.
  • The lodging cap is $50 a night per person, meals not included, and only for stays needed for care at a hospital.
  • The $7,500 dependent-care account is for care that lets the parents work, such as a sibling's daycare. It is set up through an employer, usually at open enrollment or after a family change.
  • Not every Medicaid-paid wage is excludable. The exclusion is for care of someone living in the provider's home under a Medicaid program; ask the program for its form.
  • Retirement money is a last resort with tax costs. A medical hardship withdrawal does not itself waive the early-withdrawal penalty. The medical-expense penalty exception covers only qualifying expenses above 7.5% of adjusted gross income; ordinary income tax still applies to untaxed money.
  • The emergency personal-expense withdrawal exception has separate balance, annual and repeat-use limits. Ask the plan administrator or tax preparer before using it; penalty relief is not an exemption from ordinary income tax.

The numbers and the rules

The arcane layer, kept on purpose. Checked September 10, 2026.

What it is worth

Medical costs above 7.5% of income deductible if you itemize; mileage 20.5 cents (January–June 2026) and 23.5 cents (July–December); lodging $50 a night per person; dependent-care account $7,500; child tax credit up to $2,200 a child.

  • $7.5 (only the part above this counts, and only if you itemize) — Medical-expense deduction floor
  • $20.5 — Medical mileage, January to June 2026
  • $23.5 — Medical mileage, July to December 2026
  • $50 (an accompanying parent counts; meals do not) — Lodging away from home for care, per person per night
  • $7,500/year — Dependent-care account (FSA) limit, 2026
  • $3,750/year — Dependent-care account limit, married filing separately, 2026
  • $2,200/year (maximum; not a guaranteed refund) — Child tax credit per qualifying child, 2026

Legal protection: Pay from Medicaid to a parent who provides the child's home care in the same home can be left out of federal income (IRS Notice 2014-7, since January 3, 2014) · That excluded pay can still be counted as earned income for the earned income credit, all of it or none · Parking and tolls count on top of the mileage rate

What it costs the family: None. A free VITA tax site or a preparer can run the numbers.

The eligibility facts, as published

Deduction
itemizers; unreimbursed medical costs above 7.5% of adjusted gross income
Dependent care account
through an employer plan; care that lets the parents work; limited by earned income
Child tax credit
per qualifying child; maximum $2,200 in 2026
Notice 2014 7
qualifying Medicaid waiver payments to a provider living in the same home as the person cared for; not every Medicaid-paid wage

Decisions this site cannot make: The tax return

Expect friction on: Receipts and a mileage log · Itemizing versus the standard deduction

The trap: Throwing away the mileage log. The rate is 20.5 cents a mile for January to June 2026 and 23.5 cents from July; parking and tolls are on top. The lodging cap is $50 a night per person, meals not included.

What changes by state: Nothing here is state law. Some states add their own credits; a tax preparer or a free VITA site can check.

Where I read this

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