I know for a FACT that I read about this several months ago but now I can't find it. If a family member is the primary caregiver for an elderly person and gets paid for doing so, the caregiver may not be required to pay Self Employment Tax on their tax return. There were some stipulations (the person can't be in the business of caregiving or work as a paid caregiver for anyone else). But if the conditions are met, the family caregiver doesn't have to pay Medicare or Social Security taxes on amounts paid for being the caregiver. They are still required to pay Federal Income Tax, but not the Self Employment Tax (which is SS & Medicare taxes).
Does this ring a bell with anyone? Please advise! =)