What Foster Care Stipends Are
Foster care stipends (also called board rates or foster care maintenance payments) are monthly payments from the state child welfare agency to licensed foster parents to cover the cost of caring for a foster child in their home. They are reimbursements for expenses — not wages or compensation. The federal government partially funds foster care through Title IV-E of the Social Security Act, with states covering the remainder. Stipend amounts vary significantly by state, child's age, and level of care needed.
How Much Foster Parents Receive
National average foster care stipends range from approximately $600–$1,000/month for basic foster care. State ranges: California ($900–$1,600+ depending on county and age); Texas ($800–$1,200); New York ($700–$1,000+); Mississippi ($300–$500). Within states, rates typically increase with the child's age (older children cost more to care for) and level of care needed. Check your state's foster care agency for current rate schedules.
What Stipends Are Supposed to Cover
Foster care stipends are designed to cover: food, clothing, housing costs attributable to the child, transportation for school and appointments, school supplies, recreational activities, and personal care items. The stipend is generally considered sufficient to cover basic costs but not generous — most foster parents report the stipend doesn't fully cover actual expenses, particularly for teens and children with high needs.
Enhanced Rates for Special Needs
Children with significant behavioral, emotional, or medical needs are eligible for higher "therapeutic foster care" or "treatment foster care" rates. These enhanced rates recognize the additional training, time, and resources required. Therapeutic foster care rates can range from $1,500 to $5,000+/month depending on the level of care. Foster parents who want to provide therapeutic care typically complete additional training and are matched with children who need that level of support.
Medical Coverage for Foster Children
All foster children are automatically enrolled in Medicaid regardless of their parent's income or immigration status. This Medicaid coverage is comprehensive — medical, dental, mental health, vision, and specialty care. Foster parents don't pay premiums, copays, or deductibles for the child's healthcare. This coverage continues through age 26 in most states for former foster youth.
Tax Treatment of Stipends
Foster care maintenance payments are generally excludable from gross income under IRS rules — they're considered reimbursements for caring for the foster child, not income. This means foster care stipends don't count as income for income tax purposes or for means-tested programs like SNAP, TANF, Medicaid, or Section 8. Keep records of stipend payments in case of questions, but you generally don't owe income tax on them.
How to Become a Foster Parent
Contact your state or county child welfare agency to begin the licensing process. Requirements typically include: background checks, home study, training (10–30+ hours depending on state), minimum age (usually 21+), sufficient income to support your own household (the stipend supplements, not replaces, your income), and adequate space for a foster child. The process takes 2–6 months. Foster care agencies and nonprofits can also guide you through licensing — contact your local 211 for referrals.