Having a disability allows you to receive an additional half share when you file your taxes. This is not a deduction or a tax credit, it is more like a tax reduction: the received half of the disability share will lead to a reduction in taxation by increasing the parts in the tax household (we wrote about this and other ways to optimize taxes in the article - 4 ways to reduce tax).
Here we will describe in detail all the conditions that must be met and what exactly to fill out in order to take advantage of the disability tax benefit. At the end of the article, we will look at other possible property tax reductions for taxpayers with disabilities.
How much less taxes are there if you have a disability?
If you are a person in this situation and meet the conditions below, you can check the P, F, G or I box on your tax return.
This will allow you to get an extra half piece. The half disability share will reduce your tax, but will not allow you to get a refund if you don't pay it. The tax reduction will depend on your income: the higher your tax rate, the stronger the disability discount. The IRS has limited this tax benefit to avoid abuse. For the 2022 tax return, the tax reduction through the half-share for disability is a maximum of 3,179 euros.
What are the conditions for receiving half of the disability share?
The conditions for receiving half-share disability benefits are quite restrictive. From a practical point of view, it is absolutely necessary to fulfill one of the following conditions:
- You have a disability and incapacity card of at least 80%.
- Be a holder of a CMI card (carte mobilité inclusion) indicating a disability.
- Receive a disability pension due to an industrial accident in the amount of 40% or more.
- Receive a military disability pension of 40% or more.
Unless you are in one of 4 situations, it is not possible to get tax benefits. Unless you are the spouse of a disabled person whose condition meets one of the conditions above, in these circumstances your household will be assigned a half share. The case of disabled children is discussed below.
We also note that holders of a military card or military disability pension or war victims can have a half share under certain conditions.
When can I receive half-share disability benefits?
The half share is purchased throughout the year, the tax rate is not proportional. Just indicate this on the tax return you prepare in N+1.
For example
Mr. “C” receives disability in December 2022 and his situation meets the conditions. He will be able to report this on his 2023 tax return for 2022 income. It will have a full year tax advantage over 2022 earnings.
The law also provides that you can receive a tax rebate in the year you apply for a disability card or CMI card. Then it is quite possible to fill out the application in this sense and, if necessary, correct it.
For example
Mr. “C” applied for a disability card at the end of 2022.
- Starting with the 2023 income tax return for 2022, he will be able to check the box on his tax return. He will benefit from tax deduction.
- If the gentleman receives his disability card over 80%, everything is fine.
- If he doesn't end up getting his card, all he has to do is tell the taxman that he wasn't actually entitled to a half share on his 2022 tax return. Taxes will be adjusted without markups.
Which field to fill out on a tax return for people with disabilities?
To get disability tax benefits, simply check the box on your tax return. If you are submitting a paper form, the fields appear on page 2 of the Cerfa 2042 declaration. For an online application, this occurs on Stage 2.
Depending on the situation, you need to check the following boxes:
- If you are disabled and meet one of the 4 conditions, you must tick the P box.
- Your spouse is disabled and must check the F box.
- If this is a child assigned to a fiscal home, this is field G if he is a dependent, and I if he is in variable care.
You don't need to specify anything else. The tax office will be able to request confirmation if it deems it necessary. Once you check the box, you will have a half share and the tax will be calculated automatically. Please note that the R field exists if you accommodate a person with a disability (especially an adult child) under your roof. Finally, let's talk about the requirements that must be met in the case of children with disabilities to be able to tick box I or G. The requirements are slightly different.
Disabled dependent child: who gets half share?
Having a disabled child also allows you to receive a half share and therefore tax benefits. The child must meet one of two conditions:
- Have a disability card on 80%.
- Have a CMI card indicating your disability.
If one of two conditions is met, then you can check the box to have half the disability share. Be careful, it is necessary that the child is tied to your fiscal house (foyer fiscal). If he makes his own declaration, you will not be able to receive half the share.
If the child is a minor and is fully supported, check the G box.
If your child is in variable custody, each parent has the right to check the I box, the tax benefit will be split in half. They will each have a quarter share with a maximum tax benefit of €3,179 divided by 2 (€1,590).
Finally, the R box exists if your child is an adult, disabled, and still in your tax household.
Disability and tax at source (impôt à la source): how tax cuts work
Tax cuts will affect withholding taxes. The rate charged each month will take into account the disability discount. In fact, the tax office is based on the last known statement and is issued in N+1. If you declare half the disability share each year, your rate will never change. In contrast, you will see a delay setting when the disability benefit is first declared. The tax office will only include it in the tax return in N+1 due to the tax return. It's easier to illustrate this with an example.
For example
Mr. “H” becomes disabled in 2022. He wonders when he will get the tax benefit of the half share.
The original 2022 rate does not take into account the half share because it is not on the most recent tax return. The same applies to the rate originating from January to August 2023.
On his 2023 tax return for 2022, Mr. "H" checks the P box to receive half of the disability share.
As of September 2023, the IRS is processing his return. They realize that in 2022 they took too much from Mr. “H” at the source rate. Thus, she will return to him the tax benefit received as a result of the disability.
On the same day, taxes change the withholding tax to take disability into account.
Please note that in the next statement Mr. C will receive a refund in September as his fee was too high from January to September 2023. Then he will no longer see the difference, because the rate at the source will include half the share.
To avoid this time delay, you can connect to your profile on impot.gouv.fr and request a rate change from the source. Just indicate the change in your situation. You can tell the taxman that you have become disabled and the tax office will immediately adjust the collection at source.
Other tax benefits if we are disabled
Half disability will reduce income taxes.
Note that disability can also reduce local taxes. Housing taxes and property taxes in particular may be reduced due to disability.
Source: https://www.corrigetonimpot.fr/impot-invalidite-demi-part-handicap/
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