nanny taxMake sure you don’t overlook the nanny tax as you are reviewing your filing requirements for 2018.  You could be liable to pay state and federal payroll taxes if you have a housekeeper or other household employee.
How do you know if you must pay the nanny tax?
A household employee is generally someone you hire to work in or around your home.  For example, a babysitter, nurse or gardener would be considered a household employee.  They might work part-time or full-time and it doesn’t matter whether you pay them by the job, hourly or weekly.
Keep in mind, someone is not necessarily your employee just because they do work around your house.  A lawn service, for example, may send someone to cut your grass each week.  That person would be an employee of the lawn service.
Generally, workers are not your household employee if they bring their own tools, do work for multiple customers and/or control when and how they do the work.
What are your responsibilities?
You will generally be responsible for 2017 payroll taxes if you have a household employee and if you paid that individual more than $2,000.  If you pay more than $1,000 in any quarter, federal unemployment tax kicks in as well.
Don’t hesitate to contact our office if you are uncertain whether or not you have a household employee or if you have additional questions about the nanny tax.

By Jason Saunders

Jason joined the firm in 2011 and has risen to the position of Tax Manager. In that role, he leads an expanding tax team and personally prepares highly complicated individual and corporate returns. Jason is known for his expertise in tax planning and preparation as well as a passion for researching new codes.

View bio | Read more articles

Here are a few additional articles you might be interested in:

Accounting Manager

Work Life Balance. . . Innovative Culture . . . Variety If you are an accountant with 10-15 years of accounting experience and this sounds intriguing, check this out. Work/life balance is a top priority with our team. We provide a family-friendly work environment with...

read more

The Business Checkup

No one starts a business hoping that it will fail, yet a quick check of business statistics shows that half of all businesses will. Large businesses have teams of experts who comb through complex reports to make decisions that affect hundreds of employees and ensure...

read more

Starting Your Own Home-Based Business

The five questions you should consider before taking the plunge It’s been your dream for as long as you can remember.  Maybe your entrepreneurial juices started to flow when you were a youngster and you opened a lemonade stand or you had a paper route.  Perhaps the...

read more

Can we help you find something?

Want to continue the conversation?

Share This