To get paid to be a caregiver for your parents in Texas, you generally use one of three routes: Texas Medicaid’s Consumer Directed Services (CDS) option, which lets an eligible parent hire you directly; a U.S. Department of Veterans Affairs program if your parent is a wartime veteran; or a private personal care agreement your parent funds from their own money. Which one fits depends on your parent’s income, assets, medical needs, and military history.
The Medicaid Route: Consumer Directed Services
Most family caregivers in Texas get paid through Medicaid’s Consumer Directed Services model. Under CDS, your parent becomes the employer and chooses who provides their approved services, and that person can be an adult child.
Two Medicaid programs use CDS for older adults. STAR+PLUS Home and Community-Based Services (HCBS) serves adults 21 and older with disabilities and everyone 65 and up, and it covers personal attendant services, nursing, therapies, and respite care in the home. Community First Choice (CFC) covers personal care and habilitation for Medicaid recipients who would otherwise qualify for a nursing facility. Both can be self-directed through CDS, which is what makes it possible to hire you.1Texas Health and Human Services. Consumer Directed Services (CDS)
The VA Route for Veteran Parents
If your parent served in the military, two VA programs may pay you without any Medicaid involvement.
Veteran-Directed Care gives the veteran a flexible budget for home and community services and lets them hire family members, including an adult child, with the help of a counselor.2U.S. Department of Veterans Affairs. Veteran-Directed Care – Geriatrics and Extended Care Not every VA medical center offers it, so have your parent call their local VA to check.
Aid and Attendance is a monthly pension add-on for wartime veterans and surviving spouses who need help with daily activities. In 2026, it pays $2,424 monthly for a single veteran, $2,874 for a married veteran, and $1,558 for a surviving spouse. Your parent can use that money to pay you, and the VA does not dictate who provides the care or route it through a specific agency.2U.S. Department of Veterans Affairs. Veteran-Directed Care – Geriatrics and Extended Care
Does Your Parent Qualify for Medicaid CDS
Two boxes have to be checked: financial and functional.
Income and Assets
For STAR+PLUS HCBS in 2026, income is capped at $2,982 per month for an individual or $5,964 for a couple. Countable resources are capped at $2,000 for an individual and $3,000 for a couple.3Texas Health and Human Services. Appendix XI, Income and Resource Limits The home your parent lives in and one vehicle are generally excluded from resources; bank accounts and other property typically count. Higher resource ceilings exist for related programs like the Qualified Medicare Beneficiary category, but qualifying there does not by itself open HCBS services.
Medical Need
Your parent also needs a medical assessment showing they require a nursing-facility level of care, meaning real help with activities of daily living like bathing, dressing, eating, toileting, or moving around the home. The assessment sets the number of paid care hours the state will authorize. Your parent must be a U.S. citizen, a Texas resident, and living in an appropriate community setting.4Texas Health and Human Services. STAR+PLUS HCBS Program Eligibility
Can You Be Hired
Adult children can be hired through CDS, but a few relationships are blocked. The following people cannot serve as the paid caregiver:
- Your parent themselves, since they are the employer.
- The spouse of the person receiving services, or the employer’s spouse (with a narrow exception for one program, Client Managed Personal Attendant Services).
- The designated representative managing the CDS arrangement, or that person’s spouse.
- A parent or legal guardian of a minor receiving services, which will not apply when you are caring for your own parent.
Additional restrictions can apply depending on the specific program, so confirm with the service coordinator assigned to your parent’s case.5Texas Health and Human Services. Consumer Directed Services Option Frequently Asked Questions
You will also need to pass a criminal background check and registry check before you start. You cannot have a conviction that state law bars for health care employment. The Financial Management Services Agency (FMSA) attached to your parent’s case runs the check.6Texas Health and Human Services. How CDS Works
How to Apply
Start by calling 2-1-1, the state health and human services helpline, or contacting your local Area Agency on Aging. They can point your parent to the right program. STAR+PLUS operates through managed care organizations (MCOs) that administer benefits for the state.
Once your parent applies, HHSC reviews financial documents and arranges the medical necessity assessment. A determination letter follows. If approved for STAR+PLUS HCBS, your parent enrolls with an MCO and works with a service coordinator to build an Individual Service Plan. At that point, your parent can choose the CDS option instead of an agency-assigned worker, pick an FMSA, and hire you.4Texas Health and Human Services. STAR+PLUS HCBS Program Eligibility
Have your parent’s proof of Texas residency, Social Security number, proof of age and citizenship, financial statements, and medical records ready. You will need a government-issued photo ID and your Social Security number for the caregiver side.
How Payment Actually Works
The FMSA is what makes CDS livable. Your parent picks an FMSA, and that organization handles the employer paperwork. It processes your timesheets, calculates and pays federal and state employment taxes for your parent, issues payroll at least twice a month, files employer tax forms, and helps your parent obtain an Employer Identification Number and manage the service budget.7Texas Health and Human Services. Consumer Directed Services
Your parent remains the legal employer. They set your schedule, direct how care happens, and can adjust within the service plan. The FMSA just takes the payroll and tax load off the family.
Your parent will also need a written service backup plan naming who covers when you cannot, which the service coordinator approves and reviews annually.8LII / Legal Information Institute. 26 Texas Admin Code 264.217 – Employer Responsibilities Regarding Service Backup Plan
Private Personal Care Agreements
If your parent has too much income or too many assets for Medicaid and no VA eligibility, they can still pay you directly under a written personal care agreement. Put it in writing even if it feels stiff for family, because the document does two jobs.
First, it fixes expectations. The agreement should cover the start date, a specific list of tasks, your schedule, and a pay rate in line with what a professional home care aide in your area charges. The national median hourly wage for home health and personal care aides was $16.12 in the most recent federal data, and rates vary by region.9Bureau of Labor Statistics. Home Health and Personal Care Aides Anchor your rate to what a stranger would earn for the same work.
Second, it protects your parent’s future Medicaid eligibility. Texas uses a 60-month look-back when someone applies for Medicaid-funded long-term care. During that review, the state examines significant money transfers your parent made in the prior five years. Without a written agreement, payments to you can look like gifts and trigger a penalty period during which your parent is ineligible for Medicaid nursing facility coverage. The penalty is calculated by dividing the transferred amount by the average daily cost of a private-pay nursing facility stay.10Texas Health and Human Services. I-2100, Look-Back Policy A $50,000 transfer can produce well over a year of ineligibility. Fair-market-rate payments documented in a real agreement for real services avoid the problem.
Taxes on Caregiver Pay
The tax picture splits by how you’re paid.
Paid Through CDS
The FMSA handles withholding and filing. And there’s a meaningful federal break available. Under IRS Notice 2014-7, Medicaid waiver payments for care provided in the caregiver’s own home, where the care recipient also lives, can be treated as tax-free “difficulty of care” payments and excluded from federal gross income.11Internal Revenue Service. Certain Medicaid Waiver Payments May Be Excludable From Income The condition is shared residence: you and your parent must live in the same home.
Paid Privately
Your parent becomes a household employer. If they pay you $3,000 or more in cash wages in 2026, they owe Social Security and Medicare taxes, together about 15.3%, split between employer and employee. If total household-employee cash wages hit $1,000 in any calendar quarter, federal unemployment tax of 6% on the first $7,000 of your annual wages also applies.12Internal Revenue Service. Publication 926 (2026), Household Employer’s Tax Guide Federal income tax withholding is optional for household employees but you can agree to it. Your parent reports these taxes on Schedule H with their personal return, and the income is taxable on yours.
Social Security Credits
Paid caregiving builds your Social Security record. In 2026, you earn one credit for every $1,890 in wages, up to four credits a year.13Social Security Administration. Quarter of Coverage Under CDS the FMSA takes care of the withholding automatically; under a private agreement the credits accrue once wages cross the household-employer threshold and the taxes are actually paid.
If You’re Denied
A denial is not the end. When HHSC or an MCO denies or reduces services, your parent gets a Notice of Case Action and can request a fair hearing. The deadline is 90 days from the notice for most HHSC actions and 120 days for MCO decisions in STAR+PLUS.14Texas Health and Human Services. Fair and Fraud Hearings Requests can be made by calling 2-1-1, submitting a written request, or visiting a local HHSC office. Hearings are usually held by phone. Missing paperwork and documentation errors drive a fair number of first-round rejections, and those are fixable.