DEAR SAVVY SENIOR: I have been taking care of my elderly mother for nearly three years and it’s taking a huge toll on my finances. Are there any resources you know about that can help family caregivers get paid? — Financially Exhausted
DEAR EXHAUSTED: To get paid as a family caregiver, there are various government programs, tax breaks and family payment options that may be able to help you, depending on your mom’s financial situation. Here’s where to look for help.
If your mom is low-income and eligible for Medicaid, you may be able to get paid a small amount by the state. In 15 states, Medicaid offers a Cash & Counseling program (see cashandcounseling.org) that provides an allowance that can be used for various services, including paying family members for care.
Many other states have similar programs for low-income seniors, even if the person receiving care doesn’t quite qualify for Medicaid. To find out about these options contact your local Medicaid office.
In some communities across the U.S., veterans who are at risk of nursing home placement can enroll in the Veteran-Directed Home and Community Based Services program, that allows veterans to manage their own care, including hiring and paying their own caregivers.
Also available to wartime veterans and their spouses is a benefit called Aid and Attendance that helps pay for in-home care, as well as assisted living and nursing home care. This benefit can also be used to pay family caregivers.
To be eligible your mom must need assistance with daily living activities like bathing, dressing or going to the bathroom. And, her income must be under $13,362 as a surviving spouse — minus medical and long-term care expenses. If your mom is a single veteran, her income must be below $20,795 to be eligible. Her assets must also be less than $80,000 excluding her home and car.
To learn more see va.gov/geriatrics, or contact your regional VA office, or your local veterans service organization. For contact information, call (800) 827-1000.
Uncle Sam may also be able to help if you pay at least half of your mom’s yearly expenses, and her annual income was below $3,900 in 2013 (not counting Social Security). If so, you can claim her as a dependent on your taxes, and reduce your taxable income by $3,900. See IRS Publication 501 (www.irs.gov/pub/irs-pdf/p501.pdf) or call the IRS help-line at (800) 829-1040 for information.
If you can’t claim your mom as a dependent, you may still be able to get a tax break if you’re paying at least half her living expenses including her medical and long-term care costs, and they exceed 10 percent (or 7.5 percent if you’re 65 or over) of your adjusted gross income. You can include your own medical expenses in calculating the total. See the IRS publication 502 (www.irs.gov/pub/irs-pdf/p502.pdf) for details.
If your mom doesn’t financially qualify for the government aid or the tax breaks, can she afford to pay you herself or do you have any siblings that would be willing to chip in? After all, if your mom had to pay for home care services, the costs would be anywhere between $12 and $25 per hour.
If she agrees to pay you, it’s best that you or an attorney draft a short written contract detailing your work and payment arrangements so every one involved knows what to expect. A contract will also help avoid potential problems should your mom ever need to apply for Medicaid for nursing home care.
Another payment option to consider is for your mom to adjust her will, so you receive a larger portion of her estate for providing her care. But to avoid conflict, be sure all family members are aware and in agreement.
Also, check to see if your mom has any long-term care insurance that covers in-home care. If she does, in some cases those benefits may be used to pay you.
Send your senior questions to: Savvy Senior, P.O. Box 5443, Norman, OK 73070, or visit SavvySenior.org. Jim Miller is a contributor to the NBC “Today” show and author of “The Savvy Senior” book.