Multigenerational Family Tax Credit Act of 2026

Section 2(a) introduces new section 25G(a), which provides a tax credit for taxpayers who pay or incur qualified multigenerational housing expenses. This can help everyday people offset the costs of making their homes safer and more accessible for family members.

Section 2(a) introduces new section 25G(c), which defines expenses that improve the safety, mobility, or accessibility of a principal residence to support a qualified relative who is at least 65 years old or disabled. This directly benefits families caring for aging parents or disabled relatives by encouraging home modifications.

Section 2(a) introduces new section 25G(d), which makes fifty percent of the credit refundable. This means individuals might receive money back even if they do not owe significant income taxes, helping lower-income families who take care of older or disabled relatives.

Section 2(a) introduces new section 25G(b)(1), which limits the credit to a maximum of $8,000 per taxable year. Taxpayers with expensive home modification projects may find this cap does not cover the full financial burden they face.

Section 2(a) introduces new section 25G(b)(2), which reduces the credit for taxpayers whose modified adjusted gross income exceeds $200,000 ($400,000 for joint returns) by $50 for each $1,000 over that threshold. Middle- and upper-income taxpayers above these limits will receive a smaller benefit or no benefit at all.

Section 2(a) introduces new section 25G(e), which denies a double benefit by stating that no other credit or deduction is allowed for expenses used to claim this credit, and property bases must be reduced by the credit amount. Taxpayers must be careful not to double-claim other tax breaks for the exact same home improvements.