California’s In-Home Support Services (IHSS) pays caregivers for caring for low income elderly patients, allowing the elderly to stay in their private homes and out of nursing homes. Now, caregivers that live in the homes of their patients will not be taxed on their incomes. The IRS applies this rule to all state Medicaid Home and Community-Based Services waiver programs, including California’s IHSS. However, the caregivers often have incomes that are so low, that they need their incomes to be taxable in order to claim the income tax credit. The rule is the same for paid caregiving relatives that live in the home.
For the full article, please visit the San Francisco Chronicle website: http://www.sfchronicle.com/business/networth/article/Little-known-tax-break-for-in-home-caregivers-6126375.php