Care Funding

Can I Get Paid to Care for My Parent With Dementia?

An elder law attorney mentioned, in the middle of a meeting about something else entirely, that my power of attorney let me pay myself for the time I spend managing my mom's money and her care. I had been doing it for years by then. Evenings, weekends, phone calls squeezed into a lunch break.

It had never once occurred to me that it was allowed.

I still haven't taken a dollar of it. I'll tell you why at the end. But the question deserves an answer, because a lot of people are quietly wrecking their own finances to do this, assuming there's no other way.

Can I get paid to care for a parent with dementia?

Often, yes. More often than families think. The money comes from one of three places: your parent's own funds, a Medicaid program in your state that pays family caregivers, or a veterans benefit if your parent served or was married to someone who did.

Notice which program isn't on that list. Medicare pays for your parent's medical care. It doesn't pay you for the caregiving, which is where most people start looking and stop.

Can I pay myself using my parent's power of attorney?

Usually yes, if the document allows it, and a lot of them do. Some say so outright. In many states the law fills the gap when the document is silent, on the reasoning that an agent doing real work is entitled to be paid for it.

Mine says so outright. I never read it that closely, because I was reading it for what it let me do with the bank, not for myself.

The word doing the work there is reasonable. A family member handling routine bills, insurance calls and care coordination is generally expected to charge modestly, nothing like what a professional fiduciary bills by the hour. If you want the longer version, I wrote a free guide on it. It was the most surprising thing anyone has told me since her diagnosis.

Why paying yourself without paperwork is the real mistake

Because to Medicaid, money moving from your parent's account into yours doesn't look like wages. It looks like a gift. The working assumption is that family care is given freely, so a payment to a daughter or a son is treated as a transfer unless something in writing says otherwise.

That matters enormously if your parent ever needs Medicaid to pay for care. Gifts inside the look-back window get added up and turned into a stretch of ineligibility, arriving at the exact moment your parent needs coverage most.

What does a personal care agreement have to say?

It has to be in writing, signed before the care and the money start, and specific: what you actually do, roughly how many hours, and a rate in line with what an agency near you would charge for the same work. Then you keep a running log of hours and tasks as you go.

The timing is the part families get wrong. You generally cannot write one now to cover the last three years, because a lump sum for care already given reads as a gift no matter how fair the amount is.

There's also a harder catch. Your parent is a party to this agreement, so they have to understand what they're signing. If capacity has already slipped too far, that door may be closed, which is the same wall families hit when there's no power of attorney in place yet.

Can Medicaid pay me directly?

In most states, yes, through what's usually called self-directed or consumer-directed care. Rather than assigning an agency aide, the program lets your parent choose their own caregiver and pays that person, and in most states that person can be an adult child.

Your parent has to qualify for the program first, which is its own process with its own financial and functional tests. Whether a spouse can be hired is decided state by state. So are the rates, the hours approved, and even the program's name, which is why a neighbor's experience two states over tells you very little.

The part nobody warns you about

Two things, and both catch people late. The first is that this is income. A family relationship doesn't make it tax free, and how it gets reported depends on how the arrangement is structured. A narrow exception exists for certain state program payments when the caregiver lives in the same home. Ask a tax professional rather than assuming, which is one more reason the tax side of caregiving is worth getting right early.

The second is timing, and it's the one my own attorney flagged. Your authority under a power of attorney ends the moment your parent dies. Compensation you never took, or never wrote down, doesn't quietly wait for you in the estate. It becomes a claim you'd have to file against it, and if you're also the executor, you'd be approving your own claim.

What I'd do this week

Read your power of attorney looking specifically for a compensation clause. It sits near the agent's powers and it's easy to skim past. Exactly what I did.

Start the log today either way. Date, hours, what you did. It costs a minute, it's the one thing you cannot reconstruct later, and it turns all three routes above from arguable into provable.

Then talk to an elder law attorney before a single dollar moves, especially if Medicaid is anywhere in your parent's future. Setting this up correctly the first time is one of the sequences the full guide walks through.

And tell your siblings before you take anything, not after. A payment they discover on a statement reads as something you hid, even when the document authorized it in plain language. That's how an accusation of taking money starts.

Which brings me back to my dollar. I haven't taken it because our situation has enough moving pieces that I want the agreement, the log and my brother all lined up first. Not because I don't think I've earned it. I know exactly what it has cost.

Frequently asked questions

Does Medicare pay family caregivers?

No. Medicare covers medical care for your parent, not wages for the family doing the caregiving, and that trips up almost everyone who starts looking. The programs that can pay a family member generally run through Medicaid, through a veterans benefit, or straight out of your parent's own money.

Can I pay myself for the years of care I already gave?

Usually not in a way that holds up. A care agreement generally has to be signed before the care and the money start, so a lump sum covering the past tends to read as a gift no matter how fair the amount. If your parent may ever need Medicaid, ask an elder law attorney before that money moves.

Do I have to tell my siblings I'm being paid?

You are not usually required to, but tell them anyway, and tell them first. A payment they find out about later reads as something you hid, even when it was fully authorized. A written agreement and a running log turn the same money into something you can simply show them.

This isn't legal, financial, or tax advice — it's a plain-language account of how this plays out in real families, written from managing my own mom's finances since her diagnosis. Whether a power of attorney authorizes compensation, what counts as reasonable, which Medicaid programs pay family caregivers and who qualifies, how a care agreement has to be written, and how any of it is taxed all vary by state and by document, and they change over time. Talk to an elder-law attorney licensed where your parent lives, and a tax professional, before acting on any of it.