If your adult sister is paying you (also an adult) to babysit on a regular basis, is that income that needs to be reported or does the IRS consider that a gift from a family member?

[PrairieDanielle]

I was not sure if it would be considered income. The sister who is paying is insisting on paying, but the babysitting would be done even if the sister could not afford to pay. Again, this is family. It is not being done for money, but it has ended up where there are almost weekly payments because she has insisted. Thank you in advance.

[RobertB4444 · Accepted solution]

According to IRS rules all income - no matter how small - is to be reported on your tax return.  However, gifts from family members are not seen as income.  So the question is intent.  

If the adult sister is paying you for services that you are rendering then that is income.  But if she is just giving you a present because she is so happy that you're helping out then that is a gift.

Important side note - if your adult sister is claiming a deduction for paying for child care on her tax return then that is definitely income and not a gift.

[PrairieDanielle]

Thank you, your answer was very helpful. I appreciate your time.