Year-End Money Checklist for Caregivers of Aging Parents

December is busy enough. But a handful of money deadlines land on December 31, and missing them can cost your parent, or you, real money. If you help manage a parent’s finances, this checklist covers what to handle before the year ends and what to set up for the new year.

This is general information, not tax advice. For your family’s specific situation, talk with a tax professional or financial advisor. Free tax help for older adults is also available, which we cover below.

For your parent

Required minimum distributions (RMDs)

If your parent has a traditional IRA, 401(k), or similar retirement account, they generally have to start taking a required minimum distribution each year once they reach age 73.

• Check whether this year's RMD has been taken. The deadline is usually December 31. (There's an exception for the very first RMD, which can be delayed to April 1 of the following year, but then two RMDs land in the same year.)
• Confirm the amount with the account custodian. It's based on the account balance at the end of last year and your parent's age.
• Check every account. RMDs for IRAs can be combined and taken from one IRA, but 401(k) RMDs generally have to come from each plan separately.

Missing an RMD can trigger a penalty on the amount not taken. If it’s already been missed, a tax professional can explain how to correct it, and the penalty can be reduced if fixed quickly.

Giving to charity from an IRA

If your parent gives to church or charity, a qualified charitable distribution (QCD) can be a smart move. Your parent, if 70½ or older, can send money directly from an IRA to a qualifying charity. The gift can count toward their RMD and isn’t counted as taxable income. For 2026, the annual QCD limit is about $111,000 per person.

• Ask the IRA custodian to send the gift directly to the charity before December 31. A check made out to your parent doesn't count.
• Keep the charity's acknowledgment letter for tax time.

This often works better than writing a personal check, especially for parents who no longer itemize deductions.

Medicare and insurance

• Medicare Open Enrollment ends December 7. Make sure your parent's plan still covers their doctors and prescriptions for 2027. See our Medicare Open Enrollment guide and Medicare 2027 costs.
• Use remaining benefits: dental, vision, or hearing allowances in a Medicare Advantage plan often reset January 1.
• Watch for the new Part B premium taking effect in January. It's deducted from Social Security for most people.

Social Security

• Expect the 2027 raise. Social Security benefits go up 3.6% starting in January 2027. Check your parent's online account at ssa.gov or watch for the notice in the mail.
• If your parent's income changed, check whether it affects other benefits like Medicaid, SNAP, or the Illinois Benefit Access Program. See our 2026 benefit numbers.

Property taxes and local benefits

• Cook County senior exemptions: Make sure your parent is enrolled in the senior exemption and, if eligible, the Senior Freeze. See our property tax relief guide for current income limits and application windows.
• Heating help: If heating bills are a strain, apply for LIHEAP. See our LIHEAP guide.

For you, the caregiver

Can you claim your parent as a dependent?

If you financially support a parent, you may be able to claim them as a dependent, even if they don’t live with you. In general:

• You paid more than half of their total support for the year (housing, food, medical care, and so on).
• Their gross income, not counting most Social Security, is under the IRS limit for that year (about $5,300 for 2026; check IRS Publication 501 for the official number).
• They aren't claimed as a dependent by anyone else, and generally don't file a joint return.
• Start tracking now: what you paid for rent, groceries, utilities, medical bills, and care. A simple spreadsheet or folder of receipts makes tax season much easier.

Claiming a parent can get you a credit of up to $500 for other dependents and may let you deduct medical expenses you paid for them, if you itemize. If several siblings share support, a multiple support agreement (IRS Form 2120) lets one of you claim the parent.

Dependent care FSA and credits

If you pay for adult day care or in-home care for a parent so you can work, you may be able to use:

• A dependent care FSA through your employer, if your parent qualifies as your dependent. Check your plan's deadline to use this year's money. Many plans have a December 31 deadline or a short grace period.
• The child and dependent care credit, which can also apply to care for a qualifying adult dependent who can't care for themselves.

Ask your HR department or tax preparer whether your situation qualifies.

Your own health FSA and benefits

• Use your health FSA balance before it expires. Caregiving often means putting off your own appointments.
• Check whether your employer offers caregiver benefits: backup care, employee assistance programs, or paid family leave. Many people don't know they have them.

Your own retirement

Caregiving can put your own savings on hold. If you can, check that you’re still contributing to your retirement account, and look at catch-up contributions if you’re 50 or older. Our printable Catch-Up Years retirement check-up walks through the numbers.

Paperwork to update for the new year

The quiet week between Christmas and New Year’s is a good time to get organized.

• Power of attorney: Make sure your parent has financial and health care powers of attorney, and that you know where the originals are. See our power of attorney guide.
• Beneficiaries: Check beneficiary designations on retirement accounts and life insurance. These override a will.
• Medication and doctor list: Update it with any changes from this year.
• Account list: Bank, investment, insurance, and online accounts, kept somewhere secure.
• Estate planning: Our estate planning checklist covers what to have in place.

A Parent Care Binder keeps all of this in one place, and The Everything File does the same for your own paperwork.

Free tax help

• AARP Foundation Tax-Aide: Free tax preparation, with a focus on people 50 and older. Sites open in early February at many local libraries and senior centers.
• IRS VITA and TCE programs: Free tax help for people with low to moderate income and older adults. Find a site through IRS.gov.
• Township assessor offices: Many in the Northwest Suburbs help seniors with property tax exemption paperwork.

Quick list: December 31 deadlines

• Parent's required minimum distribution (if 73 or older)
• Qualified charitable distributions from an IRA
• Charitable gifts for this year's taxes
• Your health and dependent care FSA balances (check your plan)
• Use-it-or-lose-it Medicare Advantage extras (dental, vision, hearing)

And one earlier date: Medicare Open Enrollment ends December 7.

This article is general information, not tax, legal, or financial advice. Tax rules and dollar amounts change each year. Figures last verified October 2026.

FAQ

This article is general information, not tax, legal, or financial advice. Tax rules and dollar amounts change each year. Figures last verified October 2026.