What is the advantage of an annual money gift versus a taxable wage or salary from my parents?

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I am the full time caregiver for my parents who need 24/7 care and supervision. Mom and I have discussed payment for my "services" but I'm not sure what method of payment would be more economical and advantageous for all of us? We've discussed a salary and contract, but my Mom has also expressed interest in giving me a tax free annual gift to equal that same salary amount. Any advice?
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Mom2mom, much depends upon the finances of both you and your parents. Some things to consider: Will your folks ever need medicaid? If so, payments should be as part of an employment contract. The maximum each parent can give you annually is currently set at $14,000. That comes to $270/week per parent. Is that amount in the ball park you think would be sufficient pay? What is your personal financial situation? Are there siblings? Will they resent the payments you might receive as 'gifts'. Are you living in your parent's home? Is room & Board part of yur compensation? Finally, you should consider what will happen when you can no longer take care of your folks! If they live long enough, the day will come when you will have to bring in outside help or have them live in a facility. We all think we can take care of our parents, but a 24/7 job may burn you out before your parents! Good luck
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Get a contract for sure, because if she ever needs Medicaid, they want to see the contract. Wages are better than a gift, because it pays into your SS and boosts your income at retirement.
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I'm not sure how it works in the USA, but the salary I draw (in Canada) allows me to contribute to the equivalent of your SS and, although it is only a small amount, helps me to build a slightly larger pension in the future.
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On one hand, the gift would not require you to pay income tax like the salary would.

On the other hand, the salary (properly documented) would not need to be paid back if she goes on Medicare like the gift would.
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