SACRAMENTO - People who care for the needs of their aging or ailing family members would keep a $500 tax credit that was set to expire this year, if a bill introduced by Assemblywoman Patty Berg becomes law.

"These people do their families and this state a great service," said Berg. "They care for those who might otherwise have to be placed in a nursing home or special care facility."

The Caregiver Tax Credit is for people who take care of an adult or child who needs substantial assistance to get through a day, often requiring help with bathing, eating and getting dressed.

Many caregivers are parents, spouses or adult children. The Caregivers Credit serves to either offset a tax debt, or to increase a tax refund. The tax credit helps alleviate the financial strain of care-giving, while at the same time sending a message that the care family members provide is a valuable service.

"A lot of these hardworking families are struggling with a heavy burden,” Berg said. “This credit is a small but meaningful way to help them."

There are an estimated 2.9 million caregivers in California. In just a couple years, that number is expected to reach 4 million. The availability of family caregivers is a major factor in whether or not older adults can remain at home.

If California's family caregivers were paid the typical wage of a home health aide of $8 an hour, the cost of care-giving would be $22.1 billion a year. Based on this low wage, the average caregiver provides more than $7,000 of care per year.

Using this estimate, the cost of caring for a person in the late stages of Alzheimer's Disease would be at least $36,000 a year. The typical caregiver is female, married, in her mid-forties, and a high school graduate.

The Caregivers Tax Credit was first authorized in 2000, and is set to expire this year. If Berg’s bill becomes law, the credit would expire 2010.