How to Complete and Submit Iowa Consumer Choices Option (CCO) Program Forms

To enroll in Iowa’s Consumer Choices Option and start paying your own support workers, you’ll complete two form packets — an employer packet for yourself and an employee packet for each worker you hire — after first obtaining a federal Employer Identification Number (EIN) from the IRS. The Iowa Consumer Choices Option forms flow through your Financial Management Services (FMS) provider, Veridian Credit Union, which handles payroll, tax deposits, and budget tracking once your paperwork clears review.¹²

You are the legal employer of every worker you hire. That’s what triggers the paperwork, and it’s why every form matters: no signature, no payroll.

Who You’ll Work With

Three people or entities support you through enrollment.

Your FMS provider (Veridian Credit Union in Iowa) processes paychecks, withholds and deposits employment taxes, carries workers’ compensation coverage where required, and tracks your Medicaid individual budget. Veridian’s name, address, and EIN appear on nearly every form in the packet, so ask your case manager for that information before you start filling anything out.¹

Your support broker works for you. They help you identify workers, walk you through the documentation, and are your first call when a form field is confusing.²

Your case manager approves your individual service plan and typically provides the form packets.

What to Gather Before You Start

Missing a single item can stall the whole enrollment because the FMS cannot begin payroll until every form clears review. Have these ready:

Your Social Security number, Medicaid ID number, date of birth, and mailing address.
For each worker: full legal name, home address, phone number, Social Security number, and date of birth. Workers also need original identity and employment-authorization documents in hand for the I-9.
Your FMS provider’s name, address, phone number, and federal EIN (from your case manager or support broker).
The hourly rate you plan to pay each worker, estimated weekly hours, and the services covered in your individual service plan. Wages must meet Iowa’s minimum wage, and total spending must stay within your approved budget.

Step 1: Get Your Employer Identification Number

Before you can legally pay anyone, the IRS needs to recognize you as a household employer. The EIN is a nine-digit identifier used for reporting payroll taxes, and your FMS needs it to set up your payroll account.³

Apply Online

The fastest route is the IRS’s free online EIN application, which issues your number immediately upon approval.⁴ The tool is available Monday through Friday, roughly 7 a.m. to 10 p.m. Eastern. Answer the questions on screen, confirm your information, and save or print the confirmation page.

Apply by Mail or Fax With Form SS-4

If you prefer paper, complete Form SS-4. On Line 9a (Type of entity), check “Other” and write “Household employer” along with your Social Security number. On Line 10 (Reason for applying), check “Hired employees.” Sign as the responsible party.⁵ Faxed applications usually get a response within four business days; mailed applications take four to six weeks.

Step 2: Complete the Employer Packet

The employer packet formalizes your role as the person directing and paying for services from your Medicaid budget.

Employer Agreement

This document spells out your responsibilities: supervising workers, approving timesheets, staying within your approved budget, and keeping accurate records. Mismanaging Medicaid funds or submitting false claims can lead to civil penalties and exclusion from federal health care programs.⁶ Honest records and sticking to your approved plan keep you clear of trouble.

IRS Form 2678 (Appointment of Agent)

Form 2678 authorizes Veridian to file employment tax returns, make tax deposits, and handle federal withholding on your behalf.⁷ You sign Part 2, then hand it to your FMS to complete and sign Part 3.

One box in Part 2 matters especially for home care: check the special home-care checkbox that also authorizes the agent to handle federal unemployment (FUTA) tax. Without it, your FMS can only handle Social Security, Medicare, and income tax withholding.⁸

The completed Form 2678 goes to the IRS service center in Kansas City, MO 64999 for Iowa employers.⁸ Your FMS typically mails it, but confirm rather than assume.

Step 3: Complete an Employee Packet for Each Worker

Every person you hire needs a separate employee packet. You fill out the employer portions; the worker fills out the employee portions. Both of you sign.

IRS Form W-4

Your worker completes Form W-4 so the correct federal income tax is withheld from each paycheck.⁹ Worth knowing: federal income tax withholding for household employees is technically voluntary. You withhold it only if the worker asks and you agree.¹⁰ Most workers do want it withheld to avoid a large April tax bill. The completed W-4 goes to your FMS, not to the IRS.

Form I-9

Form I-9 confirms the worker is legally authorized to work in the United States.¹¹ The worker fills out Section 1 on or before the first day of work. You fill out Section 2 within three business days of the start date, and you must physically examine original documents — a U.S. passport alone is enough, or a combination such as a driver’s license plus a Social Security card. Photocopies do not count.

Do not file the I-9 with any government agency. Keep it in your records for three years after the hire date or one year after employment ends, whichever is later.¹² Paperwork violations carry civil penalties from $288 to $2,861 per worker as of 2025.¹³

Background Check Authorization

The authorization form gives the state permission to run a criminal background check and any required screenings against abuse registries.¹⁴ A worker who refuses to sign or fails the screening cannot be hired through CCO.

Step 4: Sign and Submit

Every form that needs a signature needs the actual signer’s handwriting. No one can sign on someone else’s behalf unless a legal power of attorney or authorized representative arrangement is in place. Use black or blue ink, date each signature, and check that names match exactly across forms. A “Robert” on the W-4 and a “Bob” on the I-9 is the kind of mismatch that gets a packet kicked back.

Send the complete packets to Veridian by mail, secure fax, or its secure online portal, where you can upload scanned PDFs or JPEGs. If you upload digitally, open each file first to make sure signatures are legible and no page is cut off. Blurry or partial scans are the most common reason packets are returned. Keep a copy of every form.

What Happens Next

After your FMS receives the packets, it verifies the EIN, reviews the I-9 documentation, and confirms the background check results with the state. Processing times vary with application volume, so ask Veridian for a specific estimate. You’ll receive a confirmation by email, portal notification, or letter once everything clears. Your workers cannot start billing against your individual budget until that approval comes through.

What You’re Agreeing To on the Tax and Wage Side

Signing the packets commits you to obligations that run for as long as you employ workers. Veridian handles the mechanics — calculating withholding, depositing taxes, filing returns — but you remain the employer of record.

If you pay a household worker $3,000 or more in cash wages during 2026, Social Security and Medicare taxes apply. Social Security is 6.2% withheld from the worker and 6.2% from you, on wages up to $184,500. Medicare is 1.45% each, with no wage cap, plus an additional 0.9% withheld from the employee only on wages above $200,000.¹⁰ Your individual budget needs to cover the employer’s share.

FUTA applies if you pay $1,000 or more in total cash wages to all your household workers in any calendar quarter of 2025 or 2026. The rate is 6.0% on the first $7,000 you pay each worker in 2026, usually reduced to 0.6% after the state unemployment credit.¹⁰

Certain family members are exempt from household employment taxes even when paid through your CCO budget. Wages paid to your spouse, your child under 21, or your parent are generally excluded from Social Security and Medicare calculations. Wages paid to any worker under 18 are excluded unless household work is the worker’s principal occupation.¹⁰ These exclusions come up often because family members frequently serve as CCO workers.

On wages, federal law requires you to pay at least the federal minimum wage for every hour worked and overtime at one and a half times the regular rate for hours over 40 in a workweek.¹⁵ Check Iowa’s current minimum wage against the federal floor of $7.25 and pay whichever is higher. Build overtime costs into your individual budget before you finalize schedules. Going over budget because time-and-a-half wasn’t accounted for is a common CCO problem, and Veridian cannot pay more than your approved allocation covers.

1
Iowa Department of Health and Human Services. Consumer Choice Option
2
Centers for Medicare & Medicaid Services. Self-Directed Services
3
Internal Revenue Service. About Form SS-4, Application for Employer Identification Number (EIN)
4
Internal Revenue Service. Get an Employer Identification Number
5
Internal Revenue Service. Instructions for Form SS-4
6
Centers for Medicare & Medicaid Services. Laws Against Health Care Fraud
7
Internal Revenue Service. About Form 2678, Employer/Payer Appointment of Agent
8
Internal Revenue Service. Instructions for Form 2678
9
Internal Revenue Service. About Form W-4, Employee’s Withholding Certificate
10
Internal Revenue Service. Publication 926 (2026), Household Employer’s Tax Guide
11
U.S. Citizenship and Immigration Services. I-9, Employment Eligibility Verification
12
U.S. Citizenship and Immigration Services. 10.0 Retaining Form I-9
13
Federal Register. Civil Monetary Penalty Adjustments for Inflation
14
Centers for Medicare & Medicaid Services. Medicaid/CHIP Provider Fingerprint-Based Criminal Background Check
15
U.S. Department of Labor. Fact Sheet 79B: Live-in Domestic Service Workers Under the Fair Labor Standards Act (FLSA)