The IRS can Include Medicaid Payments to Foster Parents in Income

Posted on August 06, 2012

Are payments from Medicaid paid to a foster care provider includible income? It depends on if you are related to the person for whom you provide care. Typically, Medicaid funds paid to a foster care provider are not treated as income to the foster care provider. However, the IRS takes the position that a biological parent caring for a disabled child may not exclude the Medicaid funds from income because care provided by a biological parent is not foster care. Has the IRS contacted you whether payments you have received are includible in your income? Call us, we can help. Call 877 4 IRS LAW