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Daycare and Taxes>What Is The Best Way To Deal With DHS And Copays?
actaktmdt 10:50 AM 07-06-2011
What is the best way from a tax standpoint to handle dhs payment and copays. Two of my 4 families with another going to turn in a request to see if they qualify are paying via dhs. One parent wants to pay and then be reimbursed back, the other is simply having the state pay and then she makes up the difference later.

I would really like to streamline this across the board if I can. My concern is the reimbursements and proving should an audit occur. As you would see money coming in and out every two weeks in the amount of about $400. Ideas thoughts please?
victorial 08:27 PM 07-06-2011
In Ohio if the client qualifies for subsidized care and has a current approval letter, we are not allowed to collect more than their copayment. When I get a new client who thinks they qualify I use the charts provided by the state to figure what the copayment will be and charge that. As long as all their paperwork gets turned in on time I will recieve the reimbursement for the care.

Getting paid a big lump sum only once a month (IF all your paperwork makes it in on time with NO errors) is one of the biggest drawbacks with the voucher system in Ohio. They are currently in the process of installing a swipe card system that will eliminate our need for the tedious paperwork and make it easy to pay us more frequently than once per month.

You should be able to figure out what the copay will be and charge that. I collect the entire copay the first day of the month the client comes. I don't know about Michigan but in Ohio we get the remainder of the funds for the month about 3 weeks into the next month.
KEG123 08:42 AM 07-07-2011
My family only has a small co-pay that they pay in cash. The state mails me a check around the mid to end of the FOLLOWING month. So like, for May, I didn't get my check until maybe the 15th of June. It sucks. But I really like this family, and they were my first so I do it.
TomCopeland 10:14 AM 07-07-2011
There is no one way to handle this. You need to have records showing when you received money and when you reimbursed a parent. As long as your records indicate the coming and going of the money, you will be fine in an audit.
Tags:co-pay, dhs, subsidy issues
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