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I moved in with her (she has no house payment) to do this about 8 years ago. I work at home part-time as a medical transcriptionist. I dropped my hours from 40 to 20 because I was getting burned out trying to work AND care for Mom's worsening condition. Up until now, I haven't been getting paid, well, other than not having to pay rent, which is nice. But I did have to lose half of my income by going part time. However, my sister thinks I should be getting paid (mom can afford it) for my caregiving duties, which of course include a lot, up to and including the fact that mom is incontinent (of both). However, I am the POA (which we got a while back when Mom first starting showing signs of memory loss - back when I really wasn't sure all it entailed). Is it possible to be the POA and still set up a paid caregiver's contract? How is this done? Is a lawyer a must? I'm guessing the answer is yes but I'm hoping to hear whether it's even possible being the POA. Another question: I know there has to be some sort of notarization but Mom can't understand or wouldn't admit she needs help of any kind (though it would be 100% obvious to anyone who met her she did), and even more importantly, she can't sign her name anymore, so she can't really give consent per se. I do have a letter from her doctor that states she needs help with all "activities of daily living" and but for my care she would need a memory care unit. It just all seems almost not worth it, seeing a lawyer, doing everything required for the IRS so that she CAN pay me, etc. At the same time, I think if I DON'T get this paid agreement so I can replace some of the income I lost I could be in trouble soon. As well as I'm thinking of the implications and problems with getting her on Medi-Cal when the time comes that she needs an actual nursing home. Any words of wisdom and advice will be much appreciated. :)

After your visit to an elder care attorney, come back with how this works out. I'm always learning and appreciate when people share what they learn. Thanks for asking the question.
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Reply to Momshelp
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1 - hug your sister

2 - ask her to write up a formal letter to you saying that she has read the report from the dr & has seen how you care for your mom & that SHE would like you to start paying yourself appropriately -

3 go to an accountant to set it up & take off taxes etc - your mom may be able to deduct this as medical care - also accountant fees should be deductable too - use this accountant for her taxes from now on - it probably will more than pay for itself with all you have to navigate - if possible have them pay you from an account that is set up for this with all taxes etc shown on the cheque & use paper cheques to complete the paper trail just in case - have direct deposit retirement savings for yourself

4 - you don't pay rent but you are also night staff with interupted sleep & I bet you can't change anything from what mom wants either so you are not 'renting' but on duty all the time

5 - set up a 'get away' time for yourself like a movie matinee, shopping, spa treatment but WHATEVER YOU WANT TO DO - hire someone for 1 afternoon or evening a week because if you hired someone they would insist on time off

Good luck with your new life style - hugs from many here
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Akaheba Oct 20, 2018
Thank you Moecam. That was so very helpful.
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I’m glad that you are getting legal advice. I’ve never had to check this one out, so I’m not 100% sure, and it may be different from normal in your jurisdiction. However one important point to think about is whether anyone is going to object. It’s almost certainly a civil matter, not criminal. There is no judge or other body normally sitting in judgement on every personal arrangement like this. It goes to court only if someone questions it, and then you will certainly be at risk if you are ‘profiting’, not just performing the best service at a reasonable rate.

If there are other people close, particularly beneficiaries, it is in any case a good idea to talk to them. Explain the situation, see if they have any problems with your proposal, and get something in writing from them indicating that they are OK with the arrangement. Care that goes on for a long time may mean that the estate is much smaller than expected, and that’s when questions arise. Gossip can be very hurtful.

Oh, I just checked - I said this as the first post!
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I want to thank all who answered with their help and advice. I will be seeing an elder care lawyer soon. I see there is some conflict about whether I can set up a caregiver's contract as POA plus I expect that one day I will no longer be able to provide the level of care she will need. There would never be a problem with my sibs, who both feel I should be paid for what I am doing.

As for the suggestion someone made about paying a caregiver -- tried that route -- Mom refused to let her help her do anything and I ended up doing more work when the caregiver was here. LOL. Have to laugh at that.

Thanks to ALL again. I am so grateful for this site.
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Akaheba: What are you going to do when you can no longer take care of your mother's needs at home as her Alzheimer's worsens?
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Akaheba Oct 20, 2018
Llamalover: Well unless I can find a NH for less than 3000/month (Mom's income) then I will have to apply for Medi-Cal on her behalf. I know that the day will come where she will either pass away or require a higher level of care than I can provide. I'll deal with that when the time comes. Yet another reason to get a caregiver's agreement now.
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You may be over thinking this. But you have a lot of questions, mostly legal, so seeing a lawyer would be a good idea. The specialty would be Elder Law. So search "elder law near me" if you don't know where to begin.
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AARP has a good primer article on this topic:

aarp.org/caregiving/financial-legal/info-2017/you-can-get-paid-as-a-family-caregiver.html

It's probably worth the hassle to see an elder law attorney. And I agree with prior posts - take a look at the POA. It usually allows for expenditures for legal or tax concerns, and I would think this falls squarely in that area. This cost probably shouldn't be coming out of your pocket.

You might also ask the Elder Law attorney about drawing up a trust to shelter your mother's assets. CMS has a 60 month look back, I believe, so probably the sooner the better for sheltering anything that needs sheltering.

I'm not a tax professional, but I think that there can be a tax benefit to your Mom for paying you for caregiver services. Agree with the other suggestions that you should also see a tax professional - he can explain how to set up payments, withholdings, etc. to maximize any tax benefit of the arrangement for both of you.

It sounds daunting, I know, but if you can find good professionals, as someone else pointed out, legal and tax professionals are good people to have on your team! If I can make a suggestion - see if anyone you know can make a referral. I find going with someone who's recommended by an existing client is a great way to get "top notch" service.
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Yes, and it sounds like you need to set that up immediately. An elder care attorney is a good person to have on your team anyway.
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You say your mother can't sign her name - is that a mental issue or a physical one? If it's a mental one, then she can't now consent to a caregiver's agreement. You cannot use your POA to authorise payments to yourself for caregiving - a POA must not benefit financially unless there are specific instructions included in the original POA document. I'm afraid you've missed the boat on that score.

You can use your mother's money to pay other people to provide personal care, would that free you to increase your working hours?

I'm sorry, I agree it's a pity that this wasn't "thought of before", and I'm glad that your sister recognises the huge value of what you're doing even if the rules don't seem to!
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minstrel Oct 19, 2018
It's not true that a POA cannot use her authority to pay herself a reasonable amount for caregiving, from her mother's assets. Depends on how the POA is drafted and this depends on the particular state's law on PoA authority, since state law governs the content of POAs.
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You could either use the rate your mother would pay to hire a live in caregiver as the rate you would charge, or maybe more equitable since you are not paying rent, the local hourly rate for a care giver higher thru an agency. So you would be paid for 8 hours out of 24. If you were not living with your mother and she had to hire someone, that 8 hours would be more then reasonable since you are probably also doing other work around the house that a caregiver might not do, like mowing the lawn, home repairs etc. As the POA, you have broad latitude to do that but you do have to keep records for the estate to document and yes, pay taxes etc. If you are not a certified nurses aide, then you will need to figure out what a "companion" might be paid but if you have not priced care befire, you might be quite surprised at how high the rate it. I would use the agency rate, which is higher than just finding someone via a newspaper ad but you can certainly justify that you would use an agency to find someone. Call a local agency, and get costs over the phone; they don't need the details of why you are asking. You don't have to get approval from the siblings, who may not agree that you be paid, since of course, every dollar you are paid is less they inherit; you just have to account to the "estate" as to how the money was spent. If you seek agreement, and they don't agree, then what? It may not keep the peace since money often makes perfectly reasonable people turn ugly. They may assume you are doing this because you are living there rent free. It is often better to ask for forgiveness than permission and in this case, you don't need either. You should also keep separate records of when you used your mother's money to buy something for her; like a new recliner, or new sheets to show you are not using her money to buy something for yourself. If she may need to justify spending for Medicaid at some point, all the more reason to keep ongoing records instead of just putting receipts in a pile.
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Akaheba Oct 20, 2018
Dogparkmomma: Thank you so very much for your very helpful input. I so appreciate it.
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you are going to have to pay taxes and you better see an eldercare attorney to draw up a caregiver's contract since you have siblings, and that possibility of nursing home placement and Medicaid. See a tax specialist about setting up yourself as a "corporation" so you can get more tax benefits and it's perfectly legal.
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igloo572 Oct 19, 2018
Cetude - agree on benefits of doing Inc or LLC but they do have their own annual fed & state filings with after initial creation. If its a weekly salary & not use Inc/LLC as a pass through, then quarterly tax filings atop everything else. Old school salary w/fica paid by mom may be less tax paperwork to do.

In the words of the great (& missed every day) George Harrison:
“Let me tell you how it will be
Theres one for you, nineteen for me
’Cause I’m the taxman, yeah, I’m the taxman....
if you drive a car, I’ll tax the street,
if you try to sit, I’ll tax your seat,
if you get too cold, I’ll tax the heat,
if you talk a walk, I’ll tax your feet,
’Cause I’m the taxman, yeah.....
Taxman by George Harrison, from Revolver, 1966.
& I still have original album 😎 bought at Joske’s
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Having the POA does not preclude you from using mom's assets to pay yourself fair market value for caregiving. It's my understanding as well, that very detailed records should be kept for the care provided and for which you are charging against your mom's assets. This helps to substantiate the payments were for services rendered and not a gift thus avoiding the Medicaid lookback. However, you will need to report the compensation and pay applicable income taxes.
I've had my mom living with me for the past 4 months and I'm happy to have her continue to live with me until either she passes or I am unable to provide the level of care needed. I quit my full-time job to provide her caregiving, and as since have only been making her pay for groceries. After the new year, I plan to have a paid caregiver contract in force and be able to have a little income (while still keeping myself Medicaid eligible) and reduce mom's assets closer to the Medicaid spend-down.
Since I am her POA and also have 3 siblings, I will definitely have an attorney draw up the paid caregiver contract; while not absolutely necessary, I would just feel better as POA that my siblings not see me as double-dealing.
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Yes, spend some of mom's money on an attorney so you can be paid. Read the POA, it may even allow for payment.

A Geriatric care manager can assist with determining a fair amount based on mom's needs and tasks that you perform. You cannot negotiate with yourself.

You may consider an attorney of your own to review the agreement. Mom's attorney would prepare it on mom's dime.
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" It just all seems almost not worth it, seeing a lawyer, doing everything required for the IRS so that she CAN pay me, etc. At the same time, I think if I DON'T get this paid agreement so I can replace some of the income I lost I could be in trouble soon."

Not worth it? Of course it's worth it! Please consult an attorney familiar with Medi-Cal qualification so all is done correctly.
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Reply to CTTN55
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Yes, you can contract with your mother as an individual, and sign off on the contract on her behalf under the POA, and no there is no legal reason to use a lawyer. However quite obviously it looks a bit dodgy. You need to think about who if anyone is likely to object, talk to them about it, and get something in writing from them that they agree with the arrangement and the reasons why. However this doesn't cover any issues you may have with Medi-Cal - I hope someone else can respond on this.
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