Caring for an elderly parent at home comes with a multitude of questions and concerns, one of which may revolve around paying family member caregivers for their services. This much is true: Paying family member caregivers can be a blessing or a curse, it all depends on how it is done.
In this Elder Law Minute, Wes Coulson, Illinois Elder Law Attorney, discusses the benefits of paying family member caregivers and the drawbacks if it isn’t done properly.
Paying Family Member Caregivers: A Blessing or a Curse?
Hi, I’m Wes Coulson and this is your Elder Law Minute. One of the situations that we come across frequently is that where an elderly parent is being cared for at home by one of their adult children. So, that raises an important question and that is:
Is it okay to pay that family member for taking care of you?
Well, the answer is yes, but with a big asterisk, and that is that it’s very, very important that it be done correctly. If it’s not documented properly, the Government agencies that give out benefits are going to treat it as a gift and not payment for services.
We always think it’s important to have an independent party, like a Geriatric Care Manager, verify the need for services and the appropriateness of what’s being paid. And, it’s also really important that the income is reported for tax purposes. Because if you don’t report it, then either it was a gift and not taxable income or you’re asking the government to pay benefits based on your being a willful tax evader and they don’t take too kindly to that. So, moral of the story here: Great idea, but come see an Elder Law Attorney first. Thanks.
For more on home caregivers, visit these articles:
- Family member caregivers and VA benefits
- Caregivers and Benefits Eligibility
- Does Medicaid Pay for Home Caregivers or Assisted Living Care?
Coulson Elder Law is dedicated to providing families in the St. Louis area with their Elder Law needs. Our practice areas include Asset Preservation Planning, Veterans Benefits, Medicaid Eligibility, Alzheimer’s Planning, Special Needs Planning, Estate Planning and more. We understand the financial challenges you may face as you and your loved ones grow older. At Coulson Elder Law, our clients’ well-being is our number one priority. For immediate help, call (877)995-6876 or Contact Us and we will get in touch as soon as possible.