Paying a live-in caregiver
When a caregiver lives in your parent's home, the day-to-day looks different from hourly help — but for taxes, a live-in aide you hire directly is generally still a household employee. A few specifics are worth knowing.
Live-in still usually means household employee
If your parent hires a caregiver directly and controls the work, living in the home doesn't change the basic picture: that caregiver is generally a household employee, and the usual household-employer rules apply.
Room and board provided for the employer's convenience is often treated differently from cash wages, but the cash you pay is still wages. The specifics depend on your arrangement.
Hours, overtime, and pay
Live-in arrangements raise questions about which hours count as paid work, overtime, and how room and board factor in. These can be governed by federal and state labor rules, separate from the tax rules.
The safe approach is to agree clearly in writing on paid hours and pay rate, then run payroll on the cash wages. A tax advisor or employment attorney can help with the edge cases.
Taxes and records
As with any household employee, once wages reach about $3,000 in a year, FICA generally applies, FUTA may apply, and some states add requirements. On-the-books pay also documents the money for a possible Medicaid application later.
KinPayroll handles the calculations, pay stubs, and year-end W-2 and Schedule H for a live-in caregiver the same way it does for hourly care.
This guide is general information, not tax or legal advice. Tax and Medicaid outcomes depend on your specific situation and your state's rules — confirm with a qualified tax advisor or elder-law professional before acting.