Submitted By: someone
Answered: January 4, 2019 12:56 am

As a foster parent, are the payments I receive taxable to me?

The tax law allows individuals who receive foster care payments to exclude them from gross income if all three of the following conditions are met: (1) Payments are made pursuant to a foster care program of a State; (2) payments are paid by a State or political subdivision thereof, or a qualified agency; and (3) payments are paid to a foster care provider for the care of a qualified foster individual in the foster care provider’s home.

Tax Glossary

Kiddie tax

The tax on the investment income in excess of $1,700 (may change after 2007) of a child under age 18, based on the parents’ marginal tax rate and computed on Form 8615.

More terms