I do everything from meals, bathing, banking, driving, shopping. I am full time, there is no other way I can do this. I have retired from a previous job to work as her full time caregiver. She needs help walking with a walker, needs 24 help. I have a caretaker contract. I live in Florida. How do I file taxes? As an independent contractor to avoid paying taxes. I split the rent and with my Mother. She pays me a menial amount. I am up at 6 am and do not sleep till after she goes to bed around 10pm. I have no time for myself. I knew this. I went into this with my eyes open. But I need to know what to do about taxes. Can someone help me. I live in FLA. Also, my father is in Memory Care
Miles - "working" for your parents isn't going to meet the criteria to be an independent contractor. If you get audited - which increases for self employed filings whether you work as a caregiver or a painter - a living in the home caregiver as independent contractor will be found to be incorrect and will have taxes & penalty due. Theres a lot of info on how household workers - nannies, caregivers, maids, etc. - report to IRS on the web.
Did an elder law attorney draw up the caregiver contract? If so, I'd call the office to ask for names of CPA's or tax pros they work with. The law firm will have contact names for you.
Whatever the case you need to have all this done correctly with taxes and reporting so no glitches down the road. Mom could need a higher level of care and you could run out of steam or ability. Dad is already in a facility, right? So $ needed for dads memory care and also for facility for mom. Could mean between the 2, every $ is needed for facilities so no more $ to you; or they run out of $ so applies for Medicaid and you don't want $ paid viewed as gifting so a transfer penalty placed and parents ineligible. Think carefully if medicaid could be needed in the future as their eligibility rules are unforgiving and complex.
FMLA is designed for limited time frame events. It was never designed to provide a funding source for caregivers who leave their job to do LTCaregiving.
I am glad I never used my FMLA to take my parents to doctor appointments, or other time off... I used my vacation days, sick days, and days without pay. I was qualified to use FMLA for myself when diagnosed with cancer and needed to be on recovery for two months. It guaranteed that my job would still be there when I returned.
Another suggestion would be care. website. They have a program called nanny pay. It can be used by mom to pay you as an employee taxes taken out and you will get w2 like regular employee. This way all the tax obligations for both you and mom are taken care of. Another advantage may be that if mom pays you as caregiver she can write off as medical expense which my benefit her come tax time. But check with tax advisor, them no surprises at years end. Best to you. You are doing a wonderful thing for mom.
Social security and Medicare taxes for self employed equal 15.3% of your net income.
From the gross money mom pays you, I could see easily deducting mileage if you're using your own car. Or, it might be better if you deducted gasoline and car repairs instead.
Not sure what else you could deduct...
You might be better off having mom pay you as an employee. While you couldn't deduct expenses, your Medicare and Social Security taxes would drop in half.
Technically, if the IRS questioned your status as self employed, I think you'd have a hard time defending your position.