Do we have to pay taxes on the money Mom pays me to take care of her?
If my mother lives with us and pays us money for me to take care of her, do we have to report this to the IRS? And if she does not report it to the IRS, is this wrong?
If your mother pays you money to act as her caretaker, this is taxable income and should be reported as income on your income tax return. It is not necessary for your mother to report anything to the IRS or do any income tax withholding if you are considered an independent contractor. Your mother may be able to take some or all of the caretaking expenses as a medical expense deduction if her total medical expenses are more than 7.5% of her adjusted gross income and some of your caretaking activities qualify as medical expenses. You should discuss this with an accountant in detail to determine what you may be able to do in your particular case.
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