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Jd1234
Level 2

Independent provider

So situation is I always try to have enough taken out of each job to get something back at the end of the year  .... This year i have become an ip (independent provider) caregiver with a live in and have learned they dont tax live in care providers. So im wondering if that will have a major impact on what i get at the end of the year as they told me my income shouldnt count against me but i dont want to get to the end of the year and owe and or have nothing back how can i make sure im not losing out? And make sure im getting our money back and i wanted to make sure that i wasnt misinformed about not having to be taxed as a live in care provider.  Thanks 

1 Reply
KochuK
Employee Tax Expert

Independent provider

Hi Jd1234, thanks for posting the questions.

 

Yes, in general, "live in IP caregiver" income is not taxable. You might receive a W-2 with box 1 no taxable wage, and box 2 no Federal income tax withheld. Please confirm with the agency in charge that you will neither receive a W-2 or a W-2 with box 1 and Box 2 blank.

Please refer to "Certain Medicaid Waiver Payments May be Excludable From Income" section on "Individual Care Provider Questions"

https://www.irs.gov/individuals/certain-medicaid-waiver-payments-may-be-excludable-from-income

 

Not having earned income may adversely impact the Earned Income Credit calculation if applicable in your tax situation.

Not having Federal income withheld means you have less payment to calculate balance due/refund.

 

Please use TurboTax TaxCaster to pro forma your tax year 2022 income tax filing result.

TurboTax Tax Calculator 2021

https://turbotax.intuit.com/tax-tools/calculators/taxcaster/

 

Hope the above helps.

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