The Internal Revenue Service granted a boon* to In Home Supportive Services care providers. If you live with the IHSS Recipient, your IHSS income related to the Recipient is tax-free at both Federal and California levels.
Furthermore, it is retroactive to 2012, until April 15, 2016. Act now! You may submit amended returns and recapture paid taxes.
Special for IHSS care providers who want to submit amended returns: $75 per year for 1040EZ and 1040A returns.
Call to get an assessment of your tax situation. Free 15 minute consultation.
As a practical matter, it would benefit many of us to form a home with one or more IHSS Recipients to take advantage of this tax break. IHSS Providers currently earn $12.50 per hour.
Furthermore, if a Provider works 35 or more hours per month, they are eligible for medical insurance coverage. If you do not earn enough money to qualify for Obamacare you may want to consider this option.
The IRS created a “Difficulty of Care” category that exempts income you earn as an IHSS care Provider. The tax relief is only related to the income you earn from your in-home Recipient. If you care for others outside your home, that income remains taxable.