Yes, a family member can get paid for childcare in New York. The state’s Child Care Assistance Program (CCAP) pays qualifying relatives directly when the parent meets income and work requirements, and any family can set up a private pay arrangement outside the program. The rules that matter most are who counts as an eligible relative, whether your household qualifies for a subsidy, and how the IRS treats the money depending on whose home the care happens in.
Which Relatives Can Be Paid Through the State
New York treats certain relatives as “legally exempt” providers, meaning they can receive subsidy payments without a daycare license or registration. The eligible relatives are grandparents, great-grandparents, aunts, uncles, and siblings who live in a separate home from the child. The relationship can be by blood, marriage, or court decree, and the provider must be at least 18.1Legal Information Institute. New York Codes, Rules, and Regulations Title 18 Section 415.1 – Definitions
Several people are specifically barred from being paid. A parent cannot be paid to watch their own child, and neither can that parent’s spouse. Anyone else living in the same public assistance household as the child, or anyone included in the “child care services unit,” is also excluded.1Legal Information Institute. New York Codes, Rules, and Regulations Title 18 Section 415.1 – Definitions This catches two-parent households off guard when one parent hopes to be the paid caregiver.
Care can happen in the child’s home (“relative-only in-home child care”) or in the relative’s home (“relative-only family child care”). The state recognizes both, and the distinction matters later for taxes.1Legal Information Institute. New York Codes, Rules, and Regulations Title 18 Section 415.1 – Definitions
Does Your Family Qualify for the Subsidy
Two tests decide whether CCAP will pay a relative on your behalf: income and activity.
The income ceiling is 85% of the New York State Median Income, which varies by family size. For June 2025 through May 2026, a family of three can earn up to $95,396.83 per year, and a family of four up to $113,567.65.2OCFS. Help Paying for Child Care
The activity test asks what the parent is doing during care hours. Working full-time or part-time qualifies, as does attending high school, a post-secondary program, or vocational training. Some parents also qualify while searching for a job or transitioning off public assistance.3Legal Information Institute. New York Codes, Rules, and Regulations Title 18 Section 415.2 – Eligibility, Guarantees, and Priorities for Child Care Services
Approved families pay a weekly “family share.” The formula takes 1% of annual gross income above the state income standard, divides by 52, and rounds to the nearest 50 cents, with a $1 minimum. A family of four earning $80,000 pays roughly $9.00 per week; at $100,000 it’s about $13.00. A family size of one (just the eligible child) owes nothing.2OCFS. Help Paying for Child Care
How to Enroll Your Relative as a Provider
Before any payments start, both the parent and the relative must complete form OCFS-6000, the Legally-Exempt Child Care Provider Enrollment Form. The form collects the provider’s legal name, Social Security number, and government ID, and asks the provider to certify the relationship to the child. It’s available from the Office of Children and Family Services website or any local social services district office.
The enrollment package also includes a health and safety self-certification confirming working smoke detectors, safe drinking water, and proper storage of hazardous materials. If care happens in the relative’s home, all adults living there must be listed, and some may face background screening.
The completed package goes to the local department of social services (LDSS). Review typically runs 30 to 60 days while the state processes background checks and verifies finances.4OCFS. Legally Exempt Child Care Submitting a complete package the first time avoids the delays that incomplete applications trigger.
The provider must authorize a criminal background check. Certain felony convictions permanently disqualify an applicant, including offenses related to child abuse or neglect, spousal abuse, crimes against children, and violent felonies other than simple assault. A felony conviction within the past five years for physical assault or drug offenses creates a temporary bar that falls off after five years. Felony marijuana convictions no longer trigger mandatory disqualification as of April 2026.5NEW YORK STATE OFFICE OF CHILDREN AND FAMILY SERVICES. Criminal History Record ASFA Review Standards
What the Relative Actually Gets Paid
Legally exempt providers are paid less than licensed daycare centers. The standard reimbursement for relative-only family child care is 65% of the market rate established for registered family day care in that region.6OCFS. Local Commissioners Memorandum Transmittal: 24-OCFS-LCM-22 – Child Care Assistance Market Rates 2024 Market rates vary widely across the state, so the dollar amount in New York City will differ from a rural upstate county at the same percentage.
Once approved, the provider submits monthly attendance records showing specific days and hours of care. Payment goes directly to the provider by check or electronic deposit after the records are processed.4OCFS. Legally Exempt Child Care A daily log helps avoid payment discrepancies.
Relative-only providers are exempt from pre-service and annual training. A grandparent who only cares for related grandchildren needs no mandated coursework at all. A provider who wants a higher enhanced reimbursement rate must complete 10 hours of approved training per year drawn from 10 required subject areas set by OCFS. Standard enrollment carries no training obligation.7New York State Office of Children and Family Services. Enrollment/Re-Enrollment Training Requirements for Legally Exempt Informal Providers
Taxes: Where the Care Happens Changes Everything
Whether payments come from the state subsidy or your own pocket, the money is taxable income to the relative. The IRS treatment splits based on whose home the children are in.
When the Relative Cares for the Child in Your Home
The IRS generally treats that relative as your household employee, because you control what work is done and how. If you pay a household employee $3,000 or more in cash wages during 2026, you become a household employer and must withhold and pay Social Security and Medicare taxes, reporting them on Schedule H with your tax return.8Internal Revenue Service. Publication 926 (2026), Household Employer’s Tax Guide
When the Child Goes to the Relative’s Home
The IRS generally does not treat the relative as a household employee. Instead, the relative is self-employed. If net earnings from childcare reach $400 or more in a year, the relative owes self-employment tax and files Schedule SE.9Internal Revenue Service. Self-Employment Tax (Social Security and Medicare Taxes)
For a private arrangement where the relative is not your household employee, you must file Form 1099-NEC if you pay the relative $2,000 or more during 2026. That threshold rose from $600 for payments made after December 31, 2025.10Internal Revenue Service. Form 1099 NEC and Independent Contractors
Tax Benefits You Can Claim as the Parent
The federal Child and Dependent Care Credit lets you claim up to $3,000 in care expenses for one child under 13, or $6,000 for two or more children, as a percentage of expenses based on your adjusted gross income. You cannot claim the credit if the provider is your spouse, your dependent, your own child under 19, or the parent of the child being cared for. Payments to a grandparent, aunt, uncle, or adult sibling are generally eligible. A divorced father paying the child’s mother to babysit cannot claim the credit.11Internal Revenue Service. Child and Dependent Care Credit Information12Internal Revenue Service. Topic No. 602, Child and Dependent Care Credit
If your employer offers a Dependent Care Flexible Spending Account, you can set aside up to $7,500 in pre-tax dollars for 2026 to cover childcare, including payments to a qualifying relative.13FSAFEDS. New 2026 Maximum Limit Updates You cannot use both the FSA and the credit on the same dollars. For most moderate-income families, the FSA produces a larger benefit because it reduces taxable income rather than generating a nonrefundable credit.
Paying a Relative Privately, Without the Subsidy
Nothing in New York law stops you from privately paying any relative to watch your children, regardless of income. These arrangements require no OCFS enrollment, no LDSS approval, no background check wait, and no attendance vouchers. You agree on a rate and pay directly.
The same tax rules apply. Where care happens still determines whether the relative is a household employee or self-employed, and the same reporting thresholds kick in at the same dollar amounts. The tradeoff is that you cover the full cost, with only the federal tax benefits to offset it. For families above the CCAP income limits, or those who simply want to skip the enrollment timeline, this is the default path.