You Are Hiring a Caregiver Directly. Settle the Employer Question Before the First Shift

A caregiver is ready to work in your parent’s home. You have discussed the schedule, the tasks, and what the worker expects to receive. Do not settle the arrangement with a handshake and a check.

Local option: New Plan Care gives families in the St. Louis area in-home help so a parent can stay home: companionship, help with bathing and dressing, meals, and overnight care. Call (314) 405-0887.

Your first question is not whether the caregiver prefers cash, a check, or an electronic payment. It is who will be the employer. That answer controls the payroll file, tax reporting, wage records, insurance questions, and the name that belongs on the employment agreement.

This guide covers a private hire paid by your family. It does not cover an aide employed and paid by a home care agency, or a worker enrolled through a MO HealthNet consumer-directed program. If another organization is involved, ask it to state in writing whether it is the employer, a joint employer, a payroll agent, or only a referral service.

Who pays

Start with the working relationship, not the label on an invoice. The IRS household-employer test looks at whether you control not only what work is done, but how it is done. A caregiver may be your employee when you set the recurring schedule, assign the tasks, require the work to be performed in the home, and direct how the work is carried out. Calling the worker an independent contractor does not decide the issue.

Put four names at the top of one page: the person receiving care, the person directing the work, the person signing the checks, and the owner of the bank account used for payroll. If those names differ, stop and establish who is actually hiring the worker. A son who schedules the caregiver may be acting for his parent, but that does not automatically make the son the employer. Authority over the parent’s money is a separate question.

Ask any agency or registry these questions before accepting a referral:

• Whose name appears as employer on the caregiver’s Form W-2?
• Who withholds and deposits employment taxes?
• Who keeps the time record and pays any overtime due?
• Who handles unemployment reporting and an injury at work?
• Can the organization replace the worker, or does it only introduce workers to families?
• Will your family receive an invoice, or are you expected to run payroll?

If the answers leave your family responsible for directing and paying the worker, continue as a possible household employer. Use the official IRS, Missouri Department of Revenue, and Missouri labor pages collected on the site’s Sources page to check the classification rules and filing thresholds that apply when the work begins.

Do not assume that hiring a relative removes the paperwork. Federal tax treatment can differ according to whether the worker is a spouse, child, parent, or another relative. The identity of the worker may change which taxes apply without changing the need for a wage record or Form W-2. Take the exact relationship and expected duties to the IRS household-employer guidance or a tax preparer before the first payroll.

The papers

Build the employer file before the caregiver starts. Keep it separate from the care recipient’s medical records. The working file should contain:

• A written job description listing the permitted tasks, work location, schedule, supervision, transportation duties, and who may change the assignment.
• A signed pay agreement stating the gross hourly rate, pay period, timekeeping method, overtime treatment, expense reimbursement, and what happens when a shift is canceled.
• Form I-9, Employment Eligibility Verification, completed and retained as required. Do not keep more identity documents than the form process calls for.
• Form W-4 and, when applicable, Missouri Form MO W-4.
• The employer identification number obtained through the IRS. Form SS-4 is the paper application when the online process is not used.
• A time sheet showing the start and stop time for every shift, not just a weekly total.
• A payroll record showing gross wages, deductions, employer taxes, reimbursements, and net pay for each payday.
• Copies of Forms W-2 and W-3 and Schedule H when those forms apply.
• Missouri unemployment registration, wage reports, and payment records if the household meets the state test for coverage.
• Written answers from the homeowner or renter insurer about liability for a paid worker in the home.

Do not put a Social Security number in an ordinary shared spreadsheet or email thread. Limit the identity file to the person handling payroll and store it separately from schedules that relatives or backup caregivers can see.

If you are uncertain whether the caregiver is an employee, use IRS Form SS-8 to request a worker-status determination. That process is not a substitute for making a workable interim payroll plan. Ask a tax professional how to handle payments while classification remains unresolved.

Missouri and federal tax thresholds can change. Do not copy a dollar cutoff from an old article or payroll worksheet. Call the IRS business tax line and the Missouri Division of Employment Security with the expected gross wages and start pattern. Ask each office which registration, tax, and wage reports apply. For Missouri income-tax withholding, ask the Missouri Department of Revenue whether the household arrangement requires registration or whether withholding would be based on an agreement with the employee.

Wage rules are a separate track from tax rules. Ask the U.S. Department of Labor Wage and Hour Division whether the planned duties qualify for any companionship or live-in exemption. Describe the actual tasks and hours. Do not rely on the job title. Time spent required to remain on duty, interrupted sleep, overnight presence, and work beyond the ordinary schedule can change which hours must be paid.

If the caregiver will drive, add the vehicle owner, authorized drivers, insurance carrier, reimbursement method, and accident-reporting steps to the file. Ask both automobile insurers whether the planned driving is covered. A promise to reimburse fuel does not answer the insurance question.

The runway

Price the job from gross wages, not from the amount the caregiver wants to take home. Your runway should include employer taxes, payroll help, paid travel or waiting time when required, overtime exposure, mileage or other reimbursements, backup coverage, and any insurance added for the arrangement.

Ask a payroll service or tax preparer for a written sample payroll before you commit. Give the same facts to every service: employer name, Missouri work location, ordinary weekly hours, possible overnight hours, gross hourly rate, pay frequency, family relationship, and anticipated duties. Request one sample for an ordinary week and one for a week containing overtime or an overnight shift. The comparison should show every fee and tax separately.

Then run three checks:

1. Cash check: Can the payer’s account cover gross payroll and employer obligations even when another family member is late reimbursing it?
2. Hours check: Who approves added time, and what happens when the caregiver cannot leave at the scheduled end of a shift?
3. Backup check: Who covers an absence, and is that replacement hired by the household, supplied by an agency, or working independently?

Do not mix wages with gifts, loans, or informal advances. Pay from one identified account, use one timekeeping system, and reconcile every payroll to the bank statement. If siblings contribute, have them transfer money to the payer’s account rather than paying the caregiver through separate channels.

Before the first shift, hold a short paper review with the caregiver. Confirm the employer’s name, gross rate, payday, time-entry method, task list, cancellation rule, emergency contact, and the person authorized to approve extra hours. Give the caregiver a copy of the signed pay agreement. Do not ask the caregiver to sign blank time sheets or tax forms.

Free help

The IRS household-employer guide explains the federal employee test, tax exceptions for certain relatives, EIN process, Schedule H, and wage statements. The Missouri Department of Revenue handles state withholding questions. The Missouri Division of Employment Security handles household-employer unemployment coverage. The U.S. Department of Labor Wage and Hour Division handles federal questions about paid time, overtime, companionship services, and live-in work. Start with the official links organized on the Sources page, and write down the office, number called, question asked, and answer received.

If you need a local office to help you identify the right payer or benefits program before hiring privately, use Local Help With Paying for Care. Ask whether the person receiving care may qualify for a program that authorizes and pays attendants under its own rules. Do not promise private wages on the assumption that Medicare, MO HealthNet, the VA, or a long-term care policy will reimburse them. Get the payer’s authorization requirements in writing first.

A tax preparer takes over when you need a filing decision, a payroll calculation, or correction of wages already paid. An employment lawyer takes over when the parties dispute who employed the caregiver, whether wages remain unpaid, whether a worker was misclassified, or what liability follows an injury. A physician or licensed care professional takes over when the proposed job includes a task that may require clinical judgment, training, or a professional license. Your job is to bring each professional a clean file: the task list, schedule, payments, forms, insurance answers, and every written statement about who employs the worker.

The commitment point is simple. Do not approve the first shift until one named employer can show how time will be recorded, how gross pay will become net pay, which forms will be filed, and who answers when the schedule or work changes.