At first, it seems easier to just pay caregivers directly. You know how much they earned, you write the check or send the transfer, and everyone moves on. But this simple approach can create big problems for registry owners over time.
Handling payments yourself might look efficient, but it comes with hidden costs. These include financial, legal, and operational risks. And the more you grow, the more those risks grow with you.
When you first start out, managing caregiver payments yourself seems like the fastest route. You already have the caregiver’s hours, and there’s no waiting on a third party to issue payment. Plus, using apps like Venmo or writing personal checks feels informal and convenient.
But that convenience comes at a cost.
The most serious issue is how this payment method makes your registry appear. If payments come from your business account, or if you're issuing checks with your name on them, it can look like you're acting as the caregiver's employer.
This is exactly what the Department of Labor watches for in audits. Even if you’ve issued a 1099, your payment process could tell a different story.
Paying caregivers yourself also means you're responsible for tracking every payment, issuing 1099s, and making sure all the tax records line up. If you’re not a payroll expert, and most registry owners aren’t, it’s easy to make mistakes.
One missing form. One incorrect amount. And you could be looking at penalties, back taxes, or worse.
Registries are meant to act as referral sources, not employers. To protect that distinction, your operation needs clear separation between your business and the caregiving services being provided. When your name is on the payments, that separation starts to fade.
And if the rest of your records (care assignments, visit logs, payment approvals) live in different tools or spreadsheets, it gets even harder to show you're following registry best practices.
You don’t have to handle caregiver pay yourself. In fact, it is safer if you don’t.
Look for a service that:
This approach doesn’t just protect your business. It also builds trust with caregivers and families. Everyone knows where the money is coming from, how it’s tracked, and that it’s being handled professionally.
If you’re still paying caregivers out of your business account, now’s the time to rethink the process. The longer you wait, the more risk you take on. It also becomes harder to unwind if something goes wrong.
A few small changes in how you handle payments can save you from major financial or legal headaches later.
You built your registry to be independent. Don’t let your payment process send the wrong message.