Foster Care Payment Rates in New York: 2024-2025 Board Rates and Benefits

The phrase "getting paid to foster" does more harm than good. It misrepresents what foster care board payments are, it attracts applicants with the wrong motivations, and it discourages people who think the payments mean the government is already covering everything. Neither is true.

New York's foster care maintenance payments are set by OCFS annually to cover the actual costs of caring for a child — food, clothing, transportation, personal items. They are reimbursements for child expenses, not compensation for your time. Understanding what they cover, what they don't, and what additional benefits exist will help you plan realistically.

The 2024-2025 Maximum State Aid Rates

OCFS sets the Maximum State Aid Rates (MSAR) annually, effective July 1 through June 30 of the following year. For 2024-2025, the rates are:

The Metro rate applies to New York City (all five boroughs) and the counties of Nassau, Suffolk, Westchester, Rockland, Orange, Putnam, and Dutchess. All other counties use the Upstate rate.

These rates reflect OCFS research on what it costs to care for a child in each region. The Metro rate is higher because it accounts for New York City's cost of living — public transit, higher food costs, and typically higher childcare expenses.

Enhanced Rates for Children with Special Needs

When a child in care requires specialized support, the standard board rate is supplemented with enhanced payments. The 2024-2025 MSAR tiers above the standard rate are:

The Extraordinary Rate applies to children who require 24-hour nursing care or who exhibit severe, dangerous behavioral patterns. These placements require specific training and certification beyond the standard foster parent license.

Foster parents interested in therapeutic or medically complex placements should discuss enhanced rate eligibility with their certifying agency before placement. The rate is tied to the child's assessed needs, not to the type of home — but you need to be certified for the appropriate level of care.

Additional Financial Benefits

Initial Clothing Allowance Children entering foster care without adequate clothing are eligible for a one-time initial clothing payment. This is processed through the child's case plan, not directly to the foster parent — confirm with your caseworker when a placement is made if clothing needs exist.

Diaper Allowance Households fostering children under age two may receive up to $80 every three months for diaper and infant care costs. Ask your agency about this at placement — it is not automatically applied.

Medicaid Coverage All foster children in New York are covered by Medicaid for the duration of their placement. This coverage includes medical, dental, vision, psychiatric, and therapeutic services. Foster parents do not pay out-of-pocket for the child's healthcare. This is one of the most financially significant benefits, particularly for children with chronic health conditions or behavioral health needs.

Childcare Subsidy Foster parents who work or attend school are eligible for subsidized childcare through the state's childcare subsidy program. The subsidy covers approved daycare, after-school programs, and licensed in-home childcare. Contact your agency's financial worker to enroll — this benefit is not automatic and must be applied for.

Respite Reimbursement When you use respite care (temporary relief care provided by another certified foster family), the respite provider is reimbursed at a rate based on the child's standard board payment. As the primary foster parent, this means you can access temporary relief without a gap in care coverage.

Tax Treatment of Foster Care Payments

Foster care maintenance payments are not taxable income under IRS rules, provided the payments do not exceed the actual cost of caring for the child. If you receive more than five children in care (unlikely for most households), the tax treatment becomes more complex and you should consult a tax professional.

The IRS does not consider foster care payments compensation for services rendered — they are treated as reimbursements. This means you do not report them as earned income and they do not count toward earned income credit calculations. However, you also generally cannot claim the foster child as a dependent unless specific conditions are met.

If you later adopt a child who was in your foster home, you may be eligible for the federal adoption tax credit, which is separate from foster care board payments entirely.

What the Payments Are Not Designed to Cover

This is the part applicants sometimes find surprising. The foster care board payment covers the child's needs. It is not designed to cover the value of your time and attention, replace lost income if you need to reduce work hours, or subsidize significant home modifications.

New York regulations require that applicants demonstrate they can meet their own household's financial needs without the foster care payment. If your household budget genuinely depends on the board payment to function, the agency will flag this during the home study — not because they're being punitive, but because financial instability affects placement stability for the child.

Kinship and KinGAP Financial Support

Relatives who become kinship foster parents receive the same board rates as non-relative foster parents during the foster care period. If the placement transitions to legal guardianship through the Kinship Guardianship Assistance Program (KinGAP), the family receives a separate ongoing subsidy. Approximately 12% of foster care discharges in New York now flow through KinGAP. The financial structure of that program is covered in detail in our KinGAP and kinship foster care guide.

Planning Your Finances

The New York Foster Care Licensing Guide includes a financial overview of what the board payment covers, how to access the childcare subsidy, what clothing and diaper allowances are available, and how to work with your agency's financial worker to ensure you're receiving every benefit the child in your care is entitled to.

Foster care is not a financial strategy. But it is financially sustainable for households that plan honestly. The rates are designed to cover what a child needs — and with Medicaid, childcare subsidies, and the additional allowances, the real out-of-pocket costs are lower than most applicants expect.

See more United States guides →