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5 min read 6 stepsMay 9, 2026Verified May 2026

Foster Grandparent Stipend, Mileage, and Taxes Explained

What the federal Foster Grandparent stipend pays, why it is tax-free, and how mileage reimbursement works — plain English answers.

At a Glance

Understand exactly what the stipend is and is not

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The stipend is an hourly payment for the time you serve. It is paid by the local sponsor, funded by a federal grant. It is tax-free, exempt from Social Security and Medicare withholding, and does not count as wages, earned income, or unearned income for benefit programs. You do not pay self-employment tax on it. You do not receive a W-2 or 1099. Your sponsor will likely give you a letter at year end confirming your service hours, which you keep for your records but do not need to attach to a tax return.

Know how much you will receive

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The federal minimum stipend is $4.00 per hour as of 2026. Some local sponsors with extra grant funding pay $5.00 or $6.00 per hour. Multiply your hourly rate by your weekly service hours: 20 hours times $4.00 equals $80 per week, or about $80 every two weeks paid in arrears. Pay is usually by direct deposit or paper check, every two weeks or twice a month. Check with your local sponsor about the exact pay schedule and amount during orientation.

Submit accurate timesheets

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Each pay period (usually every two weeks) you fill out a timesheet that shows the dates and hours you served, signed by the supervisor at your service site. Submit the timesheet to your sponsor program office by the deadline (often the Monday after the pay period ends). Late timesheets can delay your stipend by a full pay period. Many grandparents keep a copy at home as a backup record. If you serve more than 40 hours in a week, the extra hours are usually not paid — confirm the weekly cap with your sponsor.

Track your mileage or accept the meal benefit

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Sponsors offer one of two transportation benefits, set by the federal program rules. Option one: mileage reimbursement at a set rate per mile (currently around 67 cents per mile, the IRS standard business rate) for your drive between home and the service site. Option two: a daily meal reimbursement (usually $5 to $10) on the days you serve. You will be asked at orientation which option you prefer. Most grandparents who drive a long distance choose mileage. Those who are dropped off or take a bus often choose the meal benefit. Some sponsors also offer free bus passes.

Confirm the impact on Social Security and other benefits

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Federal law specifically exempts the Foster Grandparent stipend from being counted as income for SSI, SNAP, Medicaid, public housing, LIHEAP energy help, and similar means-tested programs. It also does not affect your Social Security retirement benefit. However, if a state-funded program has its own income rules, ask your sponsor for a copy of the official AmeriCorps Seniors stipend exemption letter (often called the IM-58 letter) to share with the agency. Most state offices recognize this right away.

Keep the program income limit in mind for renewal

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To stay enrolled as a Foster Grandparent each year, your household income (not counting the stipend itself) must remain at or below 200 percent of the federal poverty line. If your income changes (a spouse takes a job, a pension increases), tell your program director — most sponsors recertify volunteers annually, and the director helps you navigate any changes. Even if your income rises above the limit, some sponsors have hardship exceptions and can keep you serving as a regular community volunteer without the stipend.

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One of the most common questions about the Foster Grandparent Program is: how does the money work? The short answer: you receive a small hourly stipend that is tax-free and does not affect your Social Security, SSI, Medicaid, SNAP (food stamps), or public housing benefits. You also receive transportation reimbursement (or a meal during service), and the program covers accident and liability insurance plus an annual physical exam.

The stipend is not a paycheck in the regular sense. Federal law (42 U.S. Code 5044) specifically protects Foster Grandparent stipends from being counted as income or wages. That means the IRS does not tax it, state and local governments do not tax it, and means-tested benefit programs do not count it when calculating your eligibility. You do not receive a W-2 or a 1099 from the program. You do not need to report the stipend on your federal tax return.

The current federal stipend is $4.00 per hour as of 2026 (set by AmeriCorps Seniors and reviewed periodically). Local sponsors may pay slightly more if their grant allows. For 20 hours per week of service, that comes out to about $80 per week, or roughly $4,000 per year. For 30 hours per week, about $120 per week, or about $6,000 per year. The amount is modest — it is meant to cover transportation, lunch money, and the costs of volunteering, not to be a primary income.

Many Foster Grandparents are surprised by how meaningful the stipend feels. It allows them to volunteer without losing money out of pocket, and the tax-free status means every dollar stays in the household budget. Combined with the supplemental insurance and free physical, the financial package is unusual among volunteer programs.

(Sources: 42 U.S.C. 5044; AmeriCorps Seniors federal regulations 45 CFR 2552; IRS Publication 525.)

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