S. 4396: Social Security Caregiver Credit Act of 2026

The Social Security Caregiver Credit Act of 2026 proposes to amend the Social Security Act to introduce a caregiver credit for individuals who provide unpaid care to dependent relatives. Here’s a breakdown of what the bill entails:

Purpose of the Bill

The bill acknowledges the importance of caregiving, particularly for children, the elderly, and individuals with disabilities. It aims to support unpaid caregivers by allowing them to earn credit towards their Social Security benefits, thereby enhancing their financial security as they approach retirement.

Eligibility for Caregiver Credit

Individuals can qualify for deemed wages if they:

• Provide care for at least 80 hours per month to a dependent relative without receiving monetary compensation.
• The care must not be provided during months after the individual reaches retirement age.

A “dependent relative” includes children, grandchildren, siblings, and even parents or grandparents who need assistance due to chronic dependency. The bill provides detailed definitions of what constitutes a dependent relative and a chronically dependent individual.

Calculation of Deemed Wages

The bill specifies how wages for caregiving will be calculated:

• For months when no wages or self-employment income are earned, caregivers will be credited with 50% of the national average wage index for the second calendar year prior to the caregiving month.
• In months when caregivers do earn some income, the deemed wages will be adjusted based on the income earned that month.
• Only the last 60 qualifying months of caregiving will be counted towards the deemed wages if an individual has more than 60 months of creditable caregiving.

Implementation and Regulations

The bill tasks the Commissioner of Social Security with developing regulations within one year of enactment to govern the caregiver credit. This includes preventing fraud and establishing application and certification procedures. Caregivers will need to provide documentation regarding the dependent relative and certification of ongoing eligibility for the credit.

Impact on Existing Benefits

The deemed wage provision will only apply if it results in higher benefits than what would otherwise be available without it. This means caregivers are ensured that they will receive at least the standard amounts they would be eligible for based on traditional work history.

Relevant Companies

• None found