Not Sure How Medicaid Waiver Works for Taxes?We Help AFH Owners Avoid Big Tax Mistakes.
Many CPAs do not know that certain Medicaid waiver payments can be tax-free for Adult Family Homes.
If this is filed wrong, you can overpay thousands in taxes every year.
​
We make the rules easy to understand, and we file your taxes correctly.
Why AFH Owners Get Confused
Medicaid waiver rules are not simple.
Most AFH owners are unsure because:
-
CPA doesn’t understand Notice 2014-7
-
Medicaid waiver income mixed with other income
-
AFH bookkeeping categories are wrong
-
Not sure what part is tax-free
-
Fear of doing it wrong
-
Missed deductions every year
This confusion leads to overpaying taxes — but we help fix that.
What I Help You Understand
I make Notice 2014-7 simple and clear.
​
I explain:
✔ What part of Medicaid waiver is tax-free
So you don’t pay tax on money the IRS says you don’t owe.
​
✔ How Medicaid waiver should show on your tax return
Correct reporting protects you long-term.
​
✔ What goes on Schedule C and what does NOT
Simple, step-by-step guidance.
​
✔ How to separate Medicaid waiver from other AFH income
(Done by explaining categories — not doing your bookkeeping.)
​
✔ What expenses can still be deducted
Even when the income is tax-free.
​
✔ How wrong filing affects loans, refinancing, and IRS notices
Your numbers must make sense to banks AND to the IRS.
WHAT I DO NOT DO
To keep your AFH clean and compliant, I:
-
Do not do your bookkeeping categories
-
Do not create your payroll
-
Do not recode Medicaid payments line-by-line
Instead, I:
-
Review your situation
-
Tell you if Medicaid waiver was filed wrong
-
Guide what needs to be fixed
-
File your taxes correctly
-
Help amend past wrong returns if needed
This keeps your business safe and avoids tax problems.
Why Correct Medicaid Waiver Reporting Matters
-
When Medicaid waiver (Notice 2014-7) is filed wrong, you can face:
-
Paying tax you don’t owe
-
IRS mismatch letters
-
Incorrect 1099s
-
Problems during refinancing or selling
-
Messy Profit & Loss reports
-
Higher taxable income
-
Losing thousands every year
Correct filing protects your money and your AFH.
Frequently Asked Questions
What is Notice 2014-7?
It is an IRS rule that says some Medicaid waiver payments are tax-free.
​
Are ALL Medicaid payments tax-free?
No. Some are tax-free, some are not. We explain the difference.
​
Can I still deduct expenses if the income is tax-free?
Yes. Many AFH owners can still deduct certain expenses.
​
My CPA never talked about this. Is that common?
Yes. Many CPAs do not know AFH rules. We specialize in them.
​
Can I fix old tax returns if Medicaid was filed wrong?
Yes. We can amend past returns and help recover overpaid taxes.
​
Does this work for both WA and OR?
Yes. We serve AFH owners in Washington and Oregon.
