What is the name of your state? Colorado
Under IRS notice 2014-7, all in-home medicaid care providers are tax exempt for that medicaid waiver income, as long as they also live with their client. The IRS sent me a letter with the following I am expecting more letters for future years as well:
"Please provide substantiation that the wages you are excluding were received under a state Medicaid program, (why? my W2 is sent to me by an employer that works exclusively through medicaid, they should already have this information.) and that yourself and the individual receiving care resided in the same home."
The notice allows amendment for all prior years normally amendable (In my case up to 2010) for a refund. After consulting with the IRS *beforehand* and with local law enforcement to pin down the legal definition of residency, in addition to the H&R block people who filed my amendments and last years return in January, I was told to do it for all years in their entirety. (the IRS agent said he didn't know, so file and keep the money in case we want it back.) I have done so, and the money is sitting there. (around 5 grand so far, total of 12 when all is said and done if they give me the money). But I might also have to take them/get dragged to, court. or end up getting fined more money than I can ever pay for trying to be Mr law abiding.
Here is my situation:
In 2010 I lived with the client 100% of the time
In 2011 I lived with the client 100% of the time until July, at which point I got my own apartment and lived there between 0 and 3 days out of the week, depending on when I worked. 100% of all work hours put in were when living with the client.
For all subsequent years, the same arrangement of 4-7 days living with the client and 0-3 days living alone has remained constant.
My mail goes to one or the other depending on nothing really. Drivers license and W2 etc goes to the client and I's home. The IRS sends letters to my apartment, because I put in that address in TurboTax. I consider my primary residence to be the clients home, and I was told that the address you put on returns *does not translate to where you live*, only to where you get your mail. I mean what if you are a trucker and live out of your truck and have a PO box?
Anyway the client and the rest of the family agree I live there too and most of the time. What sort of documentation do they want? the client's tax returns? a notarized signature? receipts for rent I don't pay? What should I do. The IRS has no documentation on what constitutes residency that I know of. What should I do?
Under IRS notice 2014-7, all in-home medicaid care providers are tax exempt for that medicaid waiver income, as long as they also live with their client. The IRS sent me a letter with the following I am expecting more letters for future years as well:
"Please provide substantiation that the wages you are excluding were received under a state Medicaid program, (why? my W2 is sent to me by an employer that works exclusively through medicaid, they should already have this information.) and that yourself and the individual receiving care resided in the same home."
The notice allows amendment for all prior years normally amendable (In my case up to 2010) for a refund. After consulting with the IRS *beforehand* and with local law enforcement to pin down the legal definition of residency, in addition to the H&R block people who filed my amendments and last years return in January, I was told to do it for all years in their entirety. (the IRS agent said he didn't know, so file and keep the money in case we want it back.) I have done so, and the money is sitting there. (around 5 grand so far, total of 12 when all is said and done if they give me the money). But I might also have to take them/get dragged to, court. or end up getting fined more money than I can ever pay for trying to be Mr law abiding.
Here is my situation:
In 2010 I lived with the client 100% of the time
In 2011 I lived with the client 100% of the time until July, at which point I got my own apartment and lived there between 0 and 3 days out of the week, depending on when I worked. 100% of all work hours put in were when living with the client.
For all subsequent years, the same arrangement of 4-7 days living with the client and 0-3 days living alone has remained constant.
My mail goes to one or the other depending on nothing really. Drivers license and W2 etc goes to the client and I's home. The IRS sends letters to my apartment, because I put in that address in TurboTax. I consider my primary residence to be the clients home, and I was told that the address you put on returns *does not translate to where you live*, only to where you get your mail. I mean what if you are a trucker and live out of your truck and have a PO box?
Anyway the client and the rest of the family agree I live there too and most of the time. What sort of documentation do they want? the client's tax returns? a notarized signature? receipts for rent I don't pay? What should I do. The IRS has no documentation on what constitutes residency that I know of. What should I do?