The choice of trustee is one of the most important decisions you'll make regarding your special needs trust. Here are five qu...Read more
Three Tips When Hiring a Caregiver for a Special Needs Child
- January 24th, 2015
Hiring a caregiver for someone with special needs can be a daunting task. Not only do you have to find a person with the experience, compassion, patience, and skills to work with your loved one, but you also have to comply with a host of employment laws and regulations. Here are some tips to keep in mind before, during, and after the hiring process.
1. Home Care Agencies May Be Worth the Extra Money
Caregivers employed by home care agencies may not be the cheapest option available, but the value that agencies provide can far outweigh the extra cost. For starters, agencies usually teach their caregivers how to work specifically with people with special needs. Before you hire someone, you can find out from the agency what type of training their caregivers have received. Agencies also have more than one caregiver on the payroll, which comes in handy if your caregiver is sick or quits unexpectedly. Speaking of the payroll, hiring a caregiver through an agency means that you don't have to pay the caregiver directly, so you aren't responsible for paying payroll taxes or for obtaining additional insurance.
2. Always Determine Your Responsibilities Under State and Federal Employment Laws
If you don't hire a caregiver through an agency, then you may be responsible for paying taxes and other costs as an employer. For instance, employers are responsible for paying a percentage of an employee's salary towards Social Security and Medicare, and most states also require employers to contribute to the unemployment compensation system. On top of these expenses, employers typically have to carry workers' compensation insurance, and they have to comply with minimum wage and overtime rules. In some cases, caregivers are not considered employees at all, but instead meet the requirements of an independent contractor, which frees the employer from some or all of these responsibilities. Unfortunately, every state deals with these issues differently, so it's essential to consult with an expert prior to directly hiring anyone as a caregiver.
3. Be Extra Careful When Paying Family Members
In most states, family members can serve as compensated caregivers without compromising a person with special needs' government benefits, but there are several very important caveats to keep in mind. First, if the person with special needs is paying the caregiver with his or her own money and the caregiver receives a larger salary than a non-family member would receive, then the excess compensation could be considered a gift that disqualifies the person with special needs from receiving some types of government benefits. If a special needs trust employs a family caregiver and the caregiver lives with the person with special needs, then the income that the caregiver receives from the trust could partially count against the person with special needs through a process called income deeming, and the extra family income could affect government benefits. Finally, if a family member is serving as a trustee of a special needs trust or as a guardian of the person with special needs and the family member pays himself for services rendered as a caregiver, the caregiver could be breaching his fiduciary duty to the person with special needs, especially if he acts without court approval.
The process of hiring a caregiver is not easy, but finding the right one can make a world of difference in the life of a person with special needs. Your special needs planner can help you understand the legal implications of hiring a caregiver, especially if that caregiver is a family member. So before you start writing paychecks, consult with your special needs planner.
Last Modified: 01/24/2015