So Lucky

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I have a great Mom, age 91! She has a form of demetia that relates to her short term memory only. She can still function well and goes out to bingo each week, etc. and for the most part is very healthy and happy. I also have a great daytime care giver that spends the day time hours with her to keep her company,etc. I have a question that maybe someone out there can help with. My Mom has been paying her caregiver cash for the last year and will start paying her with checks very soon. Does my Mom have any liability for taxes or anything else that she should be aware of from a legal or tax standpoint? Anyone informaiton would be welcomed and appreciated.


KJ, I'm not too sure it's a liability on your moms end. BUT it certainly is on the caregivers. If she is receiving monies for a service, she must report it. I just found out that my mother has been giving her companion extra money. She is paid by the state to be here 12 hours a week. My mom evidently pays for her bus fare. Nice gesture, I'll agree to that. But I had left $100 dollars for this years Christmas gifts put aside. My mom gave it to her. Therefore, no gifts. My brother gave my mother a gift of $300. Being fair, as it WAS a gift, I let her have $100 of it to play with. She did so. Funny thing was, the other part of it has gone missing. She has been no where without me since then etc. I keep track of all finances and she isn't allowed to be alone with the checkbook. Odd that her companion complained of no money and now she's out spending excessively. Her spending isn't my business I know, but when there's money missing and my mom is making stories about it and now were short to pay bills. Something is wrong. Sorry to ramble. It was something that's been sitting with me for a bit now. Hope at least the first part helped some!
Thanks....I was just thinking that my Mom may need to fill out some kind of form for her caregiver like a 1099 or W2 because someone will want to know where her $$ is coming from shen she fills out her taxes.

Not a good situation on your end about $$ missing and if you don't trust this person, also not good. Any chance of finding someone else?
Its not that i dont trust her. its my mom. she GAVE it to her. the previous companions had 1st stolen cash then the 2nd stole her credit card. This 3rd one really is wonderful. there is a little resentment on my part as she is paid for 12 hours a week, rarely does the 12 hours, but does an awesome job. its a little relief off me because i hate doing laundry haha. My point is. the one time i left my mothers side recently was to have surgery. that didnt go well. i was going to apply to be the official companion and be paid for those 12 hours. its a little something and im here 24/7 anyways right?

true true about the taxes.. but if a w2 is filled out the caregiver will have to report it and she will have to pay back taxes. ill have to ask my moms accountant this on thursday(what your moms liability is). shes coming for her last visit before she completely leaves it all to me. im very curious to know this tax question too.
As far as taxes go, the second you have someone step into your house, you must be clear about who is paying them, and what their expectations are.

It is important if the caregiver is being paid by the state to keep records if you pay her anything on top of that salary. It can just be a note in a ledger, 'for busfare' or 'holiday treat'...but do keep one & get her signature if you give her cash to make any purchases. In hindsight sometimes the person will reappear later and argue that she was employed by you/your mom if no records are kept.

As far as issuing a W-2, be very serious and consult your accountant before doing this. That will make you liable for employment, sdi, futa and social security taxes. Not pretty if it is a few dollars here and there.

As far as 'gifts' go.....usually in healthcare situations the whole issue of 'gifts' should be outlined in a policy. Please speak to your healthcare agency and find out the policy. You may then ask that the aide be counseled that she is not allowed to accept any money from the client. Let her know, and if need be, take steps to explain to your is a slippery slope.

Carol wrote the book on this type of thing, so I will refrain from saying more - best policy is if you are uncomfortable about it, don't let it happen.
thank you, Cat!! I thought I was just being vindictive or something =/ My mom likes her so much. I even asked her why is it my mom treats her like the best person in the world, but treats me like garbage. I don't want to take her "friend" away, but the money issues are becoming an I-S-S-U-E. I'm seriously going to check into the "gift" giving.

Do you have an accountant or someone you can talk to, KJ?
Thanks for the info. My Mom's care giver is 'independent'
Not sure why my last one didn't finish......Yes, I have an accountant and I'm going to give him a call tomorrow. I really appreicate the support from you guys. This is all fairly new to me. KJ
Hey Kelley,

You were definitely right to be concerned. That is why there is a clearly defined way of keeping the professional relationship of a HHA or CNA from becomming 'new best friend'. We all want our parents to have as many contacts and relationships as possible - but by the same token the opportunity for an aide to take advantage is recognized.

KJ - glad to hear that your aide is 'independant' - assuming you have set her up with a W-9 and give her a 1099 at year end. You might want to check out the IRS guidelines on what is considered IC and what is considered employee - you owe it to yourself to know the criteria....the IRS is fairly unforgiving and you never know what might come back to haunt you. Unless your helper is a family friend or through a registry, do check it out.


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