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I. How We Work in Washington. Based on your preferences, we provide you with information about one or more of our contracted senior living providers ("Participating Communities") and provide your Senior Living Care Information to Participating Communities. The Participating Communities may contact you directly regarding their services. APFM does not endorse or recommend any provider. It is your sole responsibility to select the appropriate care for yourself or your loved one. We work with both you and the Participating Communities in your search. We do not permit our Advisors to have an ownership interest in Participating Communities.
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V. Complaints. Please contact our Family Feedback Line at (866) 584-7340 or ConsumerFeedback@aplaceformom.com to report any complaint. Consumers have many avenues to address a dispute with any referral service company, including the right to file a complaint with the Attorney General's office at: Consumer Protection Division, 800 5th Avenue, Ste. 2000, Seattle, 98104 or 800-551-4636.
VI. No Waiver of Your Rights. APFM does not (and may not) require or even ask consumers seeking senior housing or care services in Washington State to sign waivers of liability for losses of personal property or injury or to sign waivers of any rights established under law.I agree that: A.I authorize A Place For Mom ("APFM") to collect certain personal and contact detail information, as well as relevant health care information about me or from me about the senior family member or relative I am assisting ("Senior Living Care Information"). B.APFM may provide information to me electronically. My electronic signature on agreements and documents has the same effect as if I signed them in ink. C.APFM may send all communications to me electronically via e-mail or by access to an APFM web site. D.If I want a paper copy, I can print a copy of the Disclosures or download the Disclosures for my records. E.This E-Sign Acknowledgement and Authorization applies to these Disclosures and all future Disclosures related to APFM's services, unless I revoke my authorization. You may revoke this authorization in writing at any time (except where we have already disclosed information before receiving your revocation.) This authorization will expire after one year. F.You consent to APFM's reaching out to you using a phone system than can auto-dial numbers (we miss rotary phones, too!), but this consent is not required to use our service.
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How wonderfu of you to do this for you mother! What your doing is priceless and if she had to pay for care outside of you, tremendously more expensive! Please take care of yourself so that when this time of caregiving there will be you-lefted to live your own life! I took care of my mother for years, mostly without pay. She was a difficult person. My brothers did little. She died and everything was split three ways with my brothers being in charge of my inheirtance. So please take care of you, use respite care, take trips, vacations, evenings off every week! No one deserves your health so that you can be happy. I found MBSR and meditation as the most helpful support for me. Explore options you want! Be compassionate with yourself! God bless...any tax.accountant or trust-estate lawyer SB able to answer your question.
To the first answer. I am sorry I should of said from my mom's money from the sale of her house. Thank you! I'm not sure if this will make a difference with claiming on income tax. Thanks Again!!!
I do this legally and yes you do have to pay them or you couls be liable in the future to pay it all back. Your taxes will be about 30% so save it before taxes are due. 25K is awfully cheap. You should be getting $900 a week on average, this will help with the taxes you pay, Out of that 25k you will be paying $7,500 a year. Does your pay include the heat up high, her food and pills and clothing? There is a lot to understand about this. I did it until my mothers money ran out but her SS pays her enough for me to hire a weekend caretaker so I can get out for a break. My hat is off to you, theres no place like home!
I have similiar question. I care for my mom 24/7 also. She refuses to take taxes out when she pays me "under the table"monthly. I havent reported any income, I am a bit nervous as to getting in trouble what should I do? I believe she wouldnt be able to figure the taxes,too confusing and I dont want to upset her. she has dementia also
Please consult an accountant or lawyer about this. Your mother can gift you up to about 15K a year tax free. Over that the tax bill is hers. And I don't know why you would have to pay 30% tax rate on 25K, or maybe I misunderstood.
donna - couple of issues here. The 25 large is income and reportable. If you don't have enough previous work to have you own SS to draw from in the future, it might be worth it to do late filing and penalty for the years you have "worked" to build your SS retirement history. Mom isn't going to be there forever to give you 25K.
If your mom should need to go into a NH and she does not have the $ to private pay for NH and applies for MedicAID to pay for it, there will be a lookback period of up to 5 years. So if based on today that would be August, 2017 for future lookback or if she went into a NH tomorrow could go back to May, 2007.
Now the $ she pays you for care, could be subject to a "transfer penalty" as the $ is regarded as a gift from her to you, your caregiving can be considered to be love and care and not reimbursable . The transfer penalty is different for each state as it is based on each states NH reimbursement rate. Example in TX it's about $ 148 a day as TX has a low rate, so 25K would be about 170 day transfer penalty in which you have to private pay for the NH. The sticky part about this is that it can happen that the elder qualifies for NH on Medicaid in the initial 3 or 6 months of paperwork review....they get into the NH....then a few months later, when the state has done a full review and go back 3 or 5 years in banking, SS or property records, that you get a notice of a "transfer penalty" from state Medicaid program and a bill from the NH for private pay due immediately. You can in writing do an appeal, but this is all very paperwork intensive and you likely need legal to help.
What I'd suggest is to get around the gift by doing a "personal services contract" for your mom to pay you for caregiving and she files a IRS 1099 for it and you pay taxes on it. This needs to be done by an elder care attorney who practices in your state and the county in which the house is as they will know what passes best. Also when you go, get all her other legal updated too: DPOA, MPOA, will or codicil to will, and also an "Guardianship in Case of Incapacity" (or whatever it's called in your state done - this helps for when the dementia patient wants to revoke the POA's). Good luck and pay those taxes.
As I said, seek the advice of an attorney. Igloo is correct, if she does go into a nursing facility and has to apply for Medicaid, they will "look back" at all gifts. Professional advice is the best route for you. Igloo has many valid points. Good luck.
ASAP - see an Elder Law Attorney - you will not regret it. But you may regret NOT seeing one.................... this is sticky and it sounds as though you may be going about it the wrong way - innocently - but it will catch up to you. The check to the attorney should be written by your mother or come from her account. Save the paperwork.
NURSECAREBEAR, its not up to your mother to take out taxes, its your responsibility to pay the taxes on it. if anything should happen to your mom in needing money, they will come to you. you should make out a caregivers contract, have her pay you, and then pay your taxes on it. as i said before it comes out to about 30% of your pay. we use an accountant and there is no way out, its absolutely outrageous but you have to cover your behind, pay now, instead of later. If your mom has dementia, even worse, someone can say you are taking it. good luck!
@ reverseroles. When I worked in my fathers office she had to take taxes out disability,workers comp, etc. What makes this paycheck different? It would be a of concern for my mothers health, if I suggested have someone else involved to help figure taxes. She would not have it. I do not believe she will need medicaid she has this covered long term care & preplanning. If I wasnt her daughter, the ins would pay me for her caretaking however she wants no one else to caretake and I am respecting her wishes
hi nursecarebear, you said your mom has dementia, how can he do paychecks and take out taxes , etc? If she can, sure, I guess its ok that way but she has to be of sound mind or its up to you to do. why do you get paid so low anyway? do you pay for her heat and food and diapers,, clothing etc also? Do you have a written contract for caregiving? Get it in writing so no one ever says you made her give you money, or you took money, or you didn't deserve money, etc. And pay the taxes, which will kill ya, it killed me. best of luck.
I have finished three years of caring for my Mom 24/7 and now have the luxury of a little time to think. Standing back and looking at the issue of family caregivers and taxes, I have a few points to make. The tax code is primarily written for people who have "a" job. Typically 8 hours a day, five days a week, and who have typical expenses. All the rest of the code involve nips and tucks on that model for special interests and some circumstances. Are caregivers not a special interest? No, because they have not made themselves so. What caregivers are doing is providing medically-necessary care 24 hours per day, seven days per week, with no holidays or vacation. This is a completely different institution, one that is not adequately defined in the tax code. In the tax code which is still based on that 40-hour sane working week medical expenses must crest 7% of net income (soon to be 10% I believe) in order to claim the residue and the related expenses (transportation, etc.). For incapacitated family members, the medical and related expenses are immense, requiring a large income, or else the family donates tens of thousands of dollars per year which they are unable to claim unless they claim the family member as dependent, which leaves the dependent's income completely taxable. The tax code just doesn't make sense. What the tax code incentivizes is this: NO FAMILY CAREGIVING. Sell up everything, put the person into a facility that provides the level of skills required, spend down everything until Medicaid takes over. Protect your own work career, your social security investment, enjoy evenings, weekends, holidays and vacations off, have a life (probably longer because you will also have your health), relieve the stresses of carrying the can for the entire family while siblings and "heirs" squabble, trivialize your efforts, and otherwise take pot shots at you, and let the folks in Washington, DC figure out how they bungled it.
SusanJMT - I love the ending of your post, very funny. Sad and pathetic issue. Caregiving was taken for granted by men in the economy and local communities struccture before the 50s, so sorting out the best way to add care and love, has never been carefully addressed. Many conversations needed to devise models to help families face and pay for what is best and fair and legal for family caregiver (including money set aside for their retirement later) and care for care-needing relative - which would include not just supplies, food, transportation time for health issues but structured visits, one on one time - the section on hospice in today's posts said one value of hospice is that it will bring in "music therapy" and one on one time. I believe in those times, deeply. As caregiver for a 106 year old that I grew to love, I was adding in those very things, testing to try to find healing ways to interact - they included my taking short breaks away from brief belligerence, slowing down and being myself with her - it was wonderful time, for her, and she gave wisdom and kindess to me. I did that on top of the nurses' aide tasks, for which I was paid. She was thriving with a stable care team, even though her family were old as well, and far away. And I was fired. Over a miscommunication with new office RN and management. Because I acted as if I knew what I was doing, and she found that a challenge to her. The company needed her more than one aide. I'm trying to stay on topic here, and feel that I am, because our culture has learned to create institutional professionals, and then delegate care to them. The "objective" professionals are preferred to messy love-related-care, maybe mostly to avoid squabbles between generations and siblings, in a newly (70 years?) mobilized world - a world which adds excitement and opportunites, but also adds haste and leaves it confusing as to how we deal with all other parts of our fragmented families with love and also practicality and respect for different needs. Sigh. I have asked, and I believe my company will turn my firing into a layoff, but my elderly client and I lose. This conflict between what professionals are taught to value as "objective" versus the reciprocity, motivation, and sense of value we get when we stay close - we all have work to do, to pull new definitions together to benefit us all.
Castle - your comments give a fuller picture than has been considered in many of the caregiving discussions. There is the continuum of observation and care that the short objective evaluations devalue but that sometimes hold the key to the patient's illness. Trained professionals have not only missed, but exacerbated several of my Mother's conditions and it required that I leave my job to take up the day-to-day caregiving to make her healthier. I also know what makes her tick, mentally. I suggest you start a new discussion thread in the Caregiving supertopic (a couple of levels above this topic in the topic hierarchy). I started a discussion on the benefits of family cargiving to the country and the "fairness" of the federal tax code. There are so many parts cargiving, only those who experience it can even imagine what it is all about. You and others are the experts on day-to-day beneficial caregiving. There isn't enough "in the book" to adequately advise professionals who are working "by the book" alone. Please do start a new discussion. Expand on the topic and then let's raise it to our medical professionals, assisted living administrators, and other caregivers. Quality day-to-day living for an elder patient is not or should not be a matter of 15-minute medical appointments and hours in front of the TV.
Mtmandeville, yes, the money your mom receives is her money, and if she decides to give it to you then it becomes your income, and you need to pay taxes, Social Security, and Medicare taxes on it. If your mom isn't capable of filling out the paperwork for all of that, then she should at least fill out the very simple 1099 form, with the total she paid you for the whole year, by Jan 31st of each year. You then report your income, from the 1099, on your Schedule C. Keep in mind if mom might need Medicaid in future, she will have to account for all payments to you--so have a Caregiving Contract in place before any payments are given to you, otherwise, it will look like a gift (yes even though you were taking care of her, to Medicaid it looks like a gift) and she will be disqualified from any welfare benefits.
please do not mis-interpret, MTMANDEVILLE's question....the VA aid & attendance is not taxable to the federal IRS as income ON MOM's TAXES, (caveat----individual states **may** tax pensions), but ANY money, from any source, that mom uses to pay for a caregiver (even a family member) becomes INCOME INCOME to the caregiver, and IS taxable. BE CAREFUL, you don't want the IRS to come and audit you.
I to take care of my father inlaw ,and have for about 8 years,very difficult ,mean man . About 5 of the eight years I drove and took care of everything at his house,now for the past 3 years he is in my house24-7 should I get a contract set up for he can pay me?
Yes daisyforsure2, definitely do it in writing, to avoid problems down the road. You don't want family accusing you of stealing his money, nor can you expect them to give you anything from the estate. Either he pays you a wage or he pays part of the household expenses, but get it in writing.
before my father died he put me on his checking account, I'm responsible for the care of my mother, she has alzheimers, right now I am paying a family friend to take care of her. I pay her 2K a month and I take care of all the other financial responsibilities, I never thought I needed to pay tax since I am on the checking account, I know that money I spend is for her well being.......do I need to pay taxes?? its basically my money too??
And...she had better have been doing withholding and Social Security tax too.
If this has not been done...she/you/POA had better go see a tax accountant right now. The fines and liability is pretty steep....fix it before the IRS comes down on her!
Dottie, unless your father's will said otherwise that money is not basically yours too.
But it is your mother's, and it is right for you to spend it on her care. Please take Katiekate's good advice and see a professional as soon as you can - it'll be a weight off your mind.
If you have a good accountant they can help you with reducing the taxes you owe annually by scouring your expenses and activities for write-offs and tax credits as a care giver (mileage for example, which can be estimated), thus reducing your taxes owed. I used turbo tax free service to do this something your income would qualify you for and they even helped me through a live chat with an advisor who could see my return. The closer you do this to tax time the less time you might be able to have with a live advisor. You can always ask for an extension (through free tax services online or by going to the irs website and following directions) before taxes are due and go through the online process afterwards - but I am not sure of the time limit for free filing using turbo tax.
By proceeding, I agree that I understand the following disclosures:
I. How We Work in Washington.
Based on your preferences, we provide you with information about one or more of our contracted senior living providers ("Participating Communities") and provide your Senior Living Care Information to Participating Communities. The Participating Communities may contact you directly regarding their services.
APFM does not endorse or recommend any provider. It is your sole responsibility to select the appropriate care for yourself or your loved one. We work with both you and the Participating Communities in your search. We do not permit our Advisors to have an ownership interest in Participating Communities.
II. How We Are Paid.
We do not charge you any fee – we are paid by the Participating Communities. Some Participating Communities pay us a percentage of the first month's standard rate for the rent and care services you select. We invoice these fees after the senior moves in.
III. When We Tour.
APFM tours certain Participating Communities in Washington (typically more in metropolitan areas than in rural areas.) During the 12 month period prior to December 31, 2017, we toured 86.2% of Participating Communities with capacity for 20 or more residents.
IV. No Obligation or Commitment.
You have no obligation to use or to continue to use our services. Because you pay no fee to us, you will never need to ask for a refund.
V. Complaints.
Please contact our Family Feedback Line at (866) 584-7340 or ConsumerFeedback@aplaceformom.com to report any complaint. Consumers have many avenues to address a dispute with any referral service company, including the right to file a complaint with the Attorney General's office at: Consumer Protection Division, 800 5th Avenue, Ste. 2000, Seattle, 98104 or 800-551-4636.
VI. No Waiver of Your Rights.
APFM does not (and may not) require or even ask consumers seeking senior housing or care services in Washington State to sign waivers of liability for losses of personal property or injury or to sign waivers of any rights established under law.
I agree that:
A.
I authorize A Place For Mom ("APFM") to collect certain personal and contact detail information, as well as relevant health care information about me or from me about the senior family member or relative I am assisting ("Senior Living Care Information").
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APFM may provide information to me electronically. My electronic signature on agreements and documents has the same effect as if I signed them in ink.
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APFM may send all communications to me electronically via e-mail or by access to an APFM web site.
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If I want a paper copy, I can print a copy of the Disclosures or download the Disclosures for my records.
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This E-Sign Acknowledgement and Authorization applies to these Disclosures and all future Disclosures related to APFM's services, unless I revoke my authorization. You may revoke this authorization in writing at any time (except where we have already disclosed information before receiving your revocation.) This authorization will expire after one year.
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You consent to APFM's reaching out to you using a phone system than can auto-dial numbers (we miss rotary phones, too!), but this consent is not required to use our service.
I took care of my mother for years, mostly without pay. She was a difficult person. My brothers did little. She died and everything was split three ways with my brothers being in charge of my inheirtance. So please take care of you, use respite care, take trips, vacations, evenings off every week! No one deserves your health so that you can be happy. I found MBSR and meditation as the most helpful support for me. Explore options you want! Be compassionate with yourself! God bless...any tax.accountant or trust-estate lawyer SB able to answer your question.
for a break. My hat is off to you, theres no place like home!
If your mom should need to go into a NH and she does not have the $ to private pay for NH and applies for MedicAID to pay for it, there will be a lookback period of up to 5 years. So if based on today that would be August, 2017 for future lookback or if she went into a NH tomorrow could go back to May, 2007.
Now the $ she pays you for care, could be subject to a "transfer penalty" as the $ is regarded as a gift from her to you, your caregiving can be considered to be love and care and not reimbursable . The transfer penalty is different for each state as it is based on each states NH reimbursement rate. Example in TX it's about $ 148 a day as TX has a low rate, so 25K would be about 170 day transfer penalty in which you have to private pay for the NH. The sticky part about this is that it can happen that the elder qualifies for NH on Medicaid in the initial 3 or 6 months of paperwork review....they get into the NH....then a few months later, when the state has done a full review and go back 3 or 5 years in banking, SS or property records, that you get a notice of a "transfer penalty" from state Medicaid program and a bill from the NH for private pay due immediately. You can in writing do an appeal, but this is all very paperwork intensive and you likely need legal to help.
What I'd suggest is to get around the gift by doing a "personal services contract" for your mom to pay you for caregiving and she files a IRS 1099 for it and you pay taxes on it. This needs to be done by an elder care attorney who practices in your state and the county in which the house is as they will know what passes best.
Also when you go, get all her other legal updated too: DPOA, MPOA, will or codicil to will, and also an "Guardianship in Case of Incapacity" (or whatever it's called in your state done - this helps for when the dementia patient wants to revoke the POA's). Good luck and pay those taxes.
Any other money yrs. Save out 30% for taxes.
but ANY money, from any source, that mom uses to pay for a caregiver (even a family member) becomes INCOME INCOME to the caregiver, and IS taxable.
BE CAREFUL, you don't want the IRS to come and audit you.
And...she had better have been doing withholding and Social Security tax too.
If this has not been done...she/you/POA had better go see a tax accountant right now. The fines and liability is pretty steep....fix it before the IRS comes down on her!
But it is your mother's, and it is right for you to spend it on her care. Please take Katiekate's good advice and see a professional as soon as you can - it'll be a weight off your mind.