26 U.S.C. § 131: Certain foster care payments

Gross income shall not include amounts received by a foster care provider during the taxable year as qualified foster care payments. a State or political subdivision thereof, or a qualified foster care placement agency, and paid to the foster care provider for caring for a qualified foster individual in the foster care provider’s home, or a difficulty of care payment. an agency of a State or political subdivision thereof, or a qualified foster care placement agency. a State or political subdivision thereof, or an entity designated by a State or political subdivision thereof, In the case of any foster home in which there is a qualified foster care individual who has attained age 19, foster care payments (other than difficulty of care payments) for any period to which such payments relate shall not be excludable from gross income under subsection (a) to the extent such payments are made for more than 5 such qualified foster individuals. required by reason of a physical, mental, or emotional handicap of such individual with respect to which the State has determined that there is a need for additional compensation, and provided in the home of the foster care provider, and are designated by the payor as compensation described in subparagraph (A). 10 qualified foster individuals who have not attained age 19, and 5 qualified foster individuals not described in subparagraph (A).