Yes, a family member can get paid for child care in Missouri. The most common route is the state’s Child Care Subsidy Program, which pays a qualifying non-parent relative directly for caring for an eligible child. Families who don’t qualify can pay a relative privately, and families raising a child with a developmental disability may be able to use a Medicaid waiver that compensates in-home caregivers.
The Child Care Subsidy Route
The Child Care Subsidy Program is run by the Department of Elementary and Secondary Education (DESE) Office of Childhood and uses state and federal funding to help lower-income families pay for care while they work, job hunt, or go to school.1Missouri Department of Elementary and Secondary Education. Child Care Subsidy A qualifying relative registers as a license-exempt provider, and DESE sends the payment to that relative.
Who in the Family Can Be Paid
The paid caregiver has to be a non-parent family member. Grandparents, aunts, uncles, and adult siblings are the usual choices. They register as license-exempt, meaning no full child care license is required, but the background and training rules below still apply.
When the Family Qualifies
The child must be from birth through age 13, or through age 19 if the child has special needs or is receiving protective services through the Children’s Division.2Missouri Department of Elementary and Secondary Education. Child Care Subsidy Information for Families A parent or guardian also has to show a need for care, like a job, job search, school, or training.
Income decides most cases. A family must start at or below 150% of the federal poverty level to qualify.2Missouri Department of Elementary and Secondary Education. Child Care Subsidy Information for Families For a family of four in 2026, that is roughly $49,500, based on the current poverty guideline of $33,000.3U.S. Department of Health and Human Services. 2026 Poverty Guidelines Once approved, a family can keep the subsidy as long as income stays under 85% of the State Median Income. Families whose children get protective services through the Children’s Division have the income rule waived.4Missouri Department of Elementary and Secondary Education. Programs
Families earning between 151% and 242% of the federal poverty level can still participate but owe a daily sliding fee to the provider, running from $2.50 to $10.00 per day depending on income and hours of care used.5Missouri Department of Elementary and Secondary Education. Child Care Subsidy Rates and Sliding Fees
What the Relative Has to Do to Get Approved
Background Check
Every subsidy provider, including a family member, has to pass a comprehensive background check before caring for children. The check covers fingerprinting, the National Sex Offender Registry, and Missouri’s Family Care Safety Registry.6Missouri Department of Elementary and Secondary Education. Child Care Background Check Process Anyone 18 or older living in the home where care takes place has to complete one too, and checks are renewed every five years.7Legal Information Institute. Missouri Code 5 CSR 25-600.020 – General Requirements
Health and Safety Training
Federal rules require every subsidy-paid provider to complete a one-time health and safety course, which Missouri offers free online. Caregivers also have to keep current pediatric first aid and CPR certification, which expires every two years. Accepted certifications come from nationally recognized providers like the American Red Cross and the American Heart Association.8Missouri Department of Social Services. Training Requirements for Six or Fewer Child Care Providers
How the Family Applies
Applications go through DESE’s online portal at childcare.mo.gov. Paper applications are accepted by mail, fax, or in person.9Legal Information Institute. Missouri Code 5 CSR 25-200.060 – Eligibility and Authorization for Child Care Subsidy You’ll need proof of residency (photo ID or a utility bill) and income verification, which usually means at least two pay stubs from the last 60 days, or a tax return if you’re self-employed.10Missouri Department of Elementary and Secondary Education. Application for Child Care Subsidy for Children and Families
Review takes about 15 to 30 days after DESE gets a complete application. An interview may happen by phone or in person to verify what you submitted. Once approved, both the family and the relative get notice, and payments to the relative start.
Paying a Relative Privately
If the subsidy isn’t an option, you can still pay a relative out of pocket, but the arrangement comes with tax rules the family connection doesn’t erase.
If you pay a relative $3,000 or more in cash wages during 2026 for child care in your home, the IRS treats you as a household employer. You have to withhold 6.2% for Social Security and 1.45% for Medicare from the caregiver’s pay, and match that amount yourself.11Internal Revenue Service. Topic No. 756, Employment Taxes for Household Employees These taxes are reported on Schedule H with your personal tax return. If you pay a household employee $1,000 or more in any calendar quarter, you also owe federal unemployment tax on the first $7,000 of wages.12Internal Revenue Service. Publication 926, Household Employer’s Tax Guide The IRS doesn’t distinguish between a grandparent and a stranger here.
The Child and Dependent Care Credit
Parents paying a relative may be able to claim the Child and Dependent Care Credit, which reduces federal tax directly. But the IRS limits who can be the paid caregiver. You can’t claim the credit if the person is your spouse, your child under 19, the other parent of your qualifying child (where the child is under 13), or anyone you claim as a dependent.13Internal Revenue Service. Topic No. 602, Child and Dependent Care Credit A grandparent, aunt, uncle, or adult sibling who isn’t your dependent is fine, provided you report their taxpayer identification number on your return.
Medicaid Waivers for a Child With a Disability
Families raising a child with a developmental disability have another path. Missouri’s Children with Developmental Disabilities (MOCDD) Waiver, also called the Sarah Jian Lopez Waiver, provides home and community-based services to children who would otherwise need institutional care.14Missouri Department of Social Services. 0825.000.00 Eligibility Based on Receipt of MOCDD Waiver Services It’s administered by the Missouri Department of Mental Health’s Division of Developmental Disabilities, and it waives the usual rule that parental income counts when determining a child’s Medicaid eligibility.15Missouri Department of Mental Health. Missouri Children’s Developmental Disabilities Waiver
Missouri also operates a Developmental Disabilities Comprehensive Waiver through the Department of Mental Health.16Missouri Department of Mental Health. Comprehensive Waiver Eligibility, available services, and whether a family member can serve as a paid caregiver vary by program, so call the Division of Developmental Disabilities directly to see what fits your situation.
Tax Treatment for the Relative Getting Paid
How a caregiver’s income is taxed depends on where the money comes from, and the difference can be significant.
Subsidy and Private-Pay Income
A relative receiving subsidy payments or private pay from the family generally reports the income as self-employment on Schedule C (Form 1040).17Internal Revenue Service. Instructions for Schedule C (Form 1040) Self-employment income carries both income tax and the 15.3% self-employment tax for Social Security and Medicare. Caregivers can offset some of that by deducting legitimate business expenses like supplies, food for the child, and a share of household utilities if care takes place at home.
Medicaid Waiver Payments May Be Tax-Free
Under IRS Notice 2014-7, Medicaid waiver payments received for caring for someone who lives in the caregiver’s home are treated as difficulty-of-care payments and excluded from gross income.18Internal Revenue Service. Certain Medicaid Waiver Payments May Be Excludable From Income If a family member receives MOCDD waiver payments for a child with a developmental disability who lives with them, those payments likely qualify. The Schedule C instructions address how to report nontaxable Medicaid waiver payments, and a tax preparer familiar with the rule can keep the caregiver from overpaying.17Internal Revenue Service. Instructions for Schedule C (Form 1040)
Watch the Effect on Other Benefits
If the relative who would be paid is on SSI or SNAP, run the numbers before saying yes. For SSI, child care payments count as earned income. The Social Security Administration excludes the first $65 per month plus half of anything above that, but regular pay can still meaningfully cut the monthly check.19Social Security Administration. Income Exclusions for SSI Program One exception: if the family receiving the subsidy is itself on SSI, the subsidy payment going to that family (not the provider) may be excluded from the family’s income for SSI purposes.
For SNAP, new child care income counts toward the household’s gross income limit, and whether it tips a caregiver over depends on household size and total income. A benefits counselor at the local Family Support Division office can help model the impact before anyone commits.