Can you get paid to care for a parent? How families pay a family caregiver
Many adult children cut back work to care for a parent. Getting paid for that care is possible, but it has to be set up the right way, or it can cause problems with Medicaid and taxes later.
Yes, often. A parent can pay a family caregiver from their own money under a written personal care agreement. Many state Medicaid programs also pay family members through self-directed home care, and veterans may qualify for VA programs that pay a family caregiver. Put any arrangement in writing and check the tax rules.
1. Your parent pays you, under a written agreement
If your parent can afford to pay for care, they can pay a family member instead of an agency. The Family Caregiver Alliance says a personal care agreement should be in writing, cover care provided from now on (not past help), and pay a reasonable rate. It typically lists:
- When the agreement starts and how long it lasts
- The services, how often, and where care happens
- The pay rate and payment schedule
- How the agreement can be changed, and signatures
The written agreement matters because of Medicaid. If your parent later needs Medicaid for long-term care, the program looks back five years at money your parent gave away. Payments without an agreement can be treated as gifts, which can delay Medicaid coverage. A signed agreement shows the payments were a real expense for care. If a lump-sum payment is involved, or your parent may not be able to understand and sign, talk to an elder law attorney first.
2. Medicaid programs that pay family caregivers
KFF’s 2025 survey found that every state that responded pays family caregivers in some circumstances, usually through self-directed home care, where the person receiving care hires their own caregiver. Rules vary by state, including whether a spouse can be paid.
In California, for example, In-Home Supportive Services (IHSS) lets eligible Medi-Cal recipients hire their own provider. The person receiving care is the employer, and the provider can be a family member, friend, or neighbor.
Ask your parent’s state Medicaid agency or Area Agency on Aging about “self-directed” or “consumer-directed” home care.
3. Programs for veterans
- Program of Comprehensive Assistance for Family Caregivers: for veterans with a VA disability rating of 70% or more who need at least six months of continuous, in-person personal care. The primary family caregiver can receive a monthly stipend, at least 30 days of respite care a year, and health coverage through CHAMPVA if they have no other coverage. Apply with VA Form 10-10CG.
- Veteran Directed Care: gives eligible veterans a flexible budget for services, and they can hire family, friends, or neighbors.
4. Taxes
- If your parent pays you directly, your parent may be a household employer. The IRS says Social Security and Medicare taxes apply if a household employee is paid $3,000 or more in cash wages in 2026, and your parent would report it on Schedule H. The IRS exemptions for family members cover a child under 21 but not an older child, so if you’re 21 or older these rules generally apply.
- Medicaid waiver payments for care you give in the home you share with your parent may not count as taxable income for you, according to the IRS Taxpayer Advocate Service.
Tax rules have exceptions, so a tax professional is worth an hour before you start.
5. Tell your siblings
Paying one sibling from a parent’s savings affects everyone’s inheritance, and surprises cause the worst fights. Share the agreement with your siblings before it’s signed, and keep a record of the hours and tasks you do. See our guide on splitting the cost of a parent’s care.
This guide is general information, not legal, tax, or financial advice. Rules differ by state and change over time, so check the linked sources or talk to an elder law attorney or tax professional about your family’s situation.
Common questions
Can I get paid for taking care of my mom or dad?
Often, yes. Your parent can pay you under a written personal care agreement, many state Medicaid programs pay family members through self-directed home care, and veterans may qualify for VA programs that pay a family caregiver.
Why do I need a written caregiver agreement?
Medicaid looks back five years at money a person gave away. Without a written agreement, payments to a family caregiver can be treated as gifts, which can delay your parent’s Medicaid coverage for long-term care.
Do I pay taxes on money my parent pays me for care?
They may be. Your parent may be a household employer if they pay $3,000 or more in cash wages in 2026, and some Medicaid waiver payments for care in a shared home can be left out of income. Check with a tax professional before you start.
Sources
- Personal Care Agreements, Family Caregiver Alliance
- Deficit Reduction Act: Important Facts for State Policymakers (transfer of assets), Centers for Medicare & Medicaid Services
- Medicaid’s Home Care Support for Family Caregivers in 2025, KFF, January 2026
- In-Home Supportive Services (IHSS), California Department of Social Services
- IHSS Provider Resources, California Department of Social Services
- Program of Comprehensive Assistance for Family Caregivers, U.S. Department of Veterans Affairs
- Veteran Directed Care, Administration for Community Living
- Publication 926: Household Employer’s Tax Guide (2026), IRS
- Certain Medicaid waiver payments may be excludable from income, IRS Taxpayer Advocate Service, May 2026