Should you hire a caregiver yourself, or use an agency?

Most seniors prefer to stay at home as long as possible rather than move to a nursing home. For many families, this means eventually hiring a caregiver to look after an aging relative. There are two main ways to hire someone – directly and through a home health agency.

The benefit of hiring a caregiver yourself is that you can select the person you like the best and who is the best fit for your family. In addition, hiring someone privately is usually cheaper than hiring through an agency.

On the other hand, if you hire a caregiver directly, you’ll need to consider all the tax and liability issues. As an employer, you’ll be responsible for filing payroll tax forms and verifying that the employee can legally work in the U.S. If you pay $1,700 or more in wages to any one employee in a year, you’ll need to withhold and pay Social Security and Medicare taxes. If you pay more than $1,000 in wages in a year, you’ll need to pay unemployment taxes.

In addition, the person you hire might not carry his or her own liability or workers’ compensation insurance. If an accident occurs on the job, you could be responsible.

If you hire through a home health agency, the agency is the employer, so you don’t need to worry about tax and liability issues. The agency takes care of screening and paying the employees, performing background checks, and providing insurance.

In addition, a licensed home care agency must provide ongoing supervision to its employees, helping them deal with difficult family situations or changing needs. And the agency might also be able to provide back-up if a regular caregiver is not available.

The downside of using an agency is not having as much input into the selection of the caregiver. In addition, caregivers may change or alternate, causing a disruption in care and possible confusion.

If you want to find a home health care agency near you, you can visit U.S. Government’s Eldercare Locator service at