Monday, March 15, 2010

Getting paid to care for grand parents... Approach with CAUTION!!

I just read this question on a care giver blog:  "Can I get paid to take care of my elderly grand parents?"  I had to respond, here's a summary of what I said:   The short answer is "Perhaps".. it depends on who is doing the paying and which state you live in. Sometimes family members can be paid by the state to take care of elderly or disabled family members. The amount depends on the state. Contact your local medicaide office, or state department of health,  to see what's possible.

If your grand parents pay you then there are tax issues that you as the payee need to address. You can act as an independent contractor, a sole proprietor or set up an LLC. The easiest - yet most expensive way - is to call yourself an independent contractor and bill them monthly. This means YOU must pay all federal, state and medicare and social security taxes. Be advised that the state and federal governments want you to pay estimated taxes on a quarterly basis and the federal portion alone is nearly 16%. Be assured that when ever money changes hands, the state and federal government want their share. To understand the requirements in your state, contact an accountant to learn what's possible and what's the most least costly option. ALSO be cautious about insurance - specifically liability insurance. If you're responsible for their care - lifting, dressing, bathing - then YOU might need insurance. If you're driving them around in YOUR car, then you might need added liability insurance. If YOU are hurt lifting them, then will their home owners insurance cover you? If you drive their car, are you covered?

From a personal perspective, caring for family members is probably the most stressful of all situations. Because it's FAMILY all of the dysfunction and behind-the-scene expectations come into play. Will your parents, aunts and uncles TRUST you? Will they help? Will they provide respite care if you want a day off? Who will handle the finances as these people age? What if one needs to go to nursing home and the other is left? Will you get paid half then even though you spend the same number of hours care giving? You need to think of all the things that can go wrong; of all the people who will help you or make it difficult and have a plan to deal with EACH. I would also suggest that your grand parents complete a Power of Attorney, living wills and other documents that outline EXACTLY what they want should they become incapacitated or die. It should be detailed and include WHO GETS WHAT - down to each stick of furniture and fork or spoon. This will protect them and YOU especially if you want your family relationships to outlast your grand parents. Sorry if I sound pessimistic but I've seen way too many of these situations get really ugly, really fast. I always  hope it works out and in most instances it's fine but there are always issues because you're dealing with people going through change and every one has a different opinion of what to do.

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