Has anyone hired private caregivers "under the table" and if so, how did it work out? What advice would you have?

If you plan to hire caregivers yourself, you’ll need to understand:

1 - Your state’s wage and hour laws and the federal Fair Labor Standards Act regulations issued by the U.S. Department of Labor;
2- IRS and your state’s income tax reporting and withholding requirements; and
3 - Reasons why you must protect yourself and your in-laws, and their caregiver, with unemployment insurance and workers’ compensation coverage.

Domestic workers are household employees, not independent contractors. The employer must withhold the employee’s Social Security and Medicare contributions and pay a matching portion. At the end of the year, the employer is responsible to provide their employee with a Form W-2 reporting wages paid and taxes withheld.

Violations of the FLSA can surface when the IRS or your state's Department of Revenue catches a family’s failure to file employment taxes. You may find an ideal caregiver, who assures you she will take care of taxes on her own, using a Form 1099 issued by a family member.

But when the caregiver goes to her accountant the following year, he may say she was mis-classified as an Independent Contractor, and then file a Form 8919, which reports the individual’s share of uncollected Social Security and Medicare taxes. The Form 8919 gives the caregiver credit for Social Security quarters corresponding to her wages and names the family member as the responsible employer.

This is only one of the risks that you take if you decide to hire "under the table."

An Elder Law Attorney and/or accountant in your state can help you spot the issues. There are also nationally recognized online payroll services that help people comply with the wage and hour laws governing caregiver employees.

"Heartfelt Kudos" to ALL you / us caregivers out there ....my heart goes out to each of you as I read your posts. I'm a baby-boomer (64) & many of our parents didn't, wouldn't, or refused to prepare or plan to live to 90-100+ yrs of age. Unless our parents cared daily for THEIR aging parents /or unless they were forced to experience 24/7 care for the elderly.....they probably lived in DENIAL of growing old & sickly....Until that dreaded day came when it hit them right between the eyes FORCING them (& you/ family) to acknowledge a harsh truth....they are Old, are Sickly & Need Help!!
Instead of graciously accepting the truth of their lives, the cultural and/or generational PRIDE & Need to CONTROL kicks in....they are angry-bitter-blaming because it's easier for them to DENY than to accept & change. (They're in shock that their hopes of a quick death: heart attack, accident, etc. didn't happen!!....so they're NOT prepared mentally, emotionally, spiritually & sadly financially).
My story: quit corporate career to be primary caregiver to my 91 yr old mom & dad. I'm married 20 yrs with no children. Husband/I welcomed my parents into our home; gave them downstairs master bedrm suite (King bed; 2-person reclining leather sofa; 6-drawer dresser w/ 32"cable TV lots of windows/light....bedroom has private bathrm (walk-in shower) & walk-in closet.
After they arrived, husband/I experienced "daily steep learning curves" & "kick-in-the teeth reality trials".
Dad-91: COPD; oxygen 24/7, mild heart issue, ungrateful, demanding, prideful, selfish, insomnia, claustrophobic, curses like a sailor, picky re: food, critical & complaining all the time. Right eye blind; barely can read w/left eye, angry I won't let him drive & wants to be driven around; out of house, but can walk, shower, toilet, eat & mentally ok.
Mom-91: Dementia past 15+ yrs,
needs 24/7 care = toilet, bathe
/brush teeth, dress, walk, fed 3 meals, exercise....everything. Like a child; grateful except when she suffers with "Sundowners / Sundown syndrome" at dusk or cloudy, rainy days. (I never heard of Sundowners until I started
caring for my parents!... reason I'm mentioning it here).
**Hard learned realities:**
-my efforts to serve/care for my parents almost ruined marriage. 1st=God - 2nd=husband - 3rd=parents / family - etc.
-family dysfunctions (we all have them!) will be "magnified" with stress of circumstances. Prepare yourself to be hurt, criticized, judged & feel isolated...but your faith will get stronger & although you 'think you'll die" from the weight of responsibility + learning "stuff" you never wanted to know...don't give up - you will survive & if you can really forgive all (including yourself), you will be "free" in ways you never imagined possible!!
-I lost 20 lbs... got 3 hrs sleep daily / exhausted. Changing diapers every 2+ hrs, cooking, laundry, driving / doctor visits / shower / dress / brush teeth / feed mom & fight with dad 24/7.
-get mental competency tests / evaluations!! (2) different doctor letters required depending on the state. Your loved one may look the same, but they are NOT who you (or even they) remember them to be...they can't make sound, logical decisions. I used to give my parents $500.00 /mo... .I later find they spent $250.00 / mo on Publisher's Clearing Hse "Crap"!!
..a total SHAM as previous person posted; PCH preys on the elderly!!
-get legal & medical POA asap
-become their Soc Sec "payee"
so you can step in & are in position to help them.....when they make hateful statements & say horribly hurtful words to you, forgive them & help them anyway.
Very hard to do!
-Have integrity! Stand out; Don't fit in or just get away with things like others may
-A previous post listed harsh realities about elder care...hard to read, yet words were honest.
-Don't isolate yourself!! Love & be kind to yourself. (I said things & acted out from frustration, exhaustion, resentment, etc - talk about it! You can't help anyone if you're not "whole/healthy"

Don't hire under the table or work under the table! It is called Tax Evasion which is a federal offense and a felony. Someone can also call anonymously to the IRS Fraud Tip Line to report this type of activity.

"Under the table" implies you are paying cash, they are not reporting it on their income tax, and you are not reporting it on a 1099 form. If you are having someone come in once or twice a month to sit with your loved one for a few hours, this probably works out OK. But if it is a substantial number of hours it may really be better in the long run to do it above board. It is kind of a nuisance, but it is not really difficult once it is set up.

But as for hiring privately instead of going through an agency, their are some very good people who work independently, just as there are some very good people who work for agencies. For independent workers you'll have to check references and do your own screening. Independents have sick children and get colds and have dental appointments, too, so hiring independently isn't a sure-thing solution to no-shows.

Well , i say anyone can be a caregiver none looks at how elder become babies again . Just like taking care of a new born is the same thing with an elder person . And yes some times it is to trust someone to take care of your loved one's but if you stop to think what makes anyone so sure your loved one's our safe in a nursing home or hospital, haven't you seen how some elders get mess treated , some don't get feed , or some don't get a bath . And these are people that our certificate and are licensed the ones you should hire . And the ones that do get paid cash or under the table whatever you want to call it . Their the ones that are more careful nothing happens cause they don't want to be held responsible for anything. Some people are ready to judge others when only God can do that . Some of you should give others a chance you will be surprised how someone out of an agent company can do just as good as someone that does work for an agency company can . Thank you all may you all have a blessed night.

been doing caregiving for along time companies and other ways ..always worked out good for me..never had problems....so when turn 66 you can make any amount of money and it will not affect your social secuirty..anyone have a good way to go about pay cash only for a short lenght of time....live in md....

Don’t do it. It is tax fraud and income tax evasion. Should Medicaid become involved it can cause problems. And the caregiver is earning no social security credits.

"Under the table" sounds a little sneaky, but yes, you can hire supplemental help. Sometimes the people who work with healthcare agencies appreciate having some extra work on the side. You can check to see if it is allowed with their agency, or hire someone from outside the agency. You may want to check the laws on hiring help to make sure you're not responsible for taxes or other things. If it is a limited number of hours, you probably won't be. I would keep things above board so nothing comes back to haunt you.

We hired someone to give baths to my father. He first met him through our home care company. He was glad to have the extra work and the company was fine with it. Many of the home health workers don't make a lot of money, so it may be a good source for you if it is okay with their agency.

Don't do it, it's unethical. Just because the caregiver wants to be underhanded doesn't mean you should agree to it. Is it worth the risk of being caught? Is your loved one protected? Too many "ifs".

We had the most wonderful woman who worked for my Mom for several years. She even came in at 1am on New Years Day when my Mom had an emergency. You wouldn’t find an Agency that would do that. My Mom loved her dearly and still misses her. My mom’s health declined to the point she needed full time care. She was a treasure. We found her though some neighbors who had used her. If you find the right person I don’t see why it wouldn’t work.