{"id":26791,"date":"2012-05-29T17:53:31","date_gmt":"2012-05-29T17:53:31","guid":{"rendered":"https:\/\/resource-center.hrblock.com\/?p=26791"},"modified":"2022-04-05T16:34:18","modified_gmt":"2022-04-05T21:34:18","slug":"nanny-tax-guide","status":"publish","type":"post","link":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/","title":{"rendered":"Nanny Tax: Paying Babysitters And Other Household Employees"},"content":{"rendered":"<p>Having help around the house over the summer can lighten your load, but you need to understand your possible tax responsibilities for paying the babysitter or the person who mows your lawn. Discussion on this topic, which is often called \u201cthe nanny tax,\u201d generally focuses on how many taxpayers ignore these responsibilities and subsequently engage in what the IRS defines as \u201c<a href=\"https:\/\/www.hrblock.com\/tax-center\/irs\/tax-responsibilities\/prision-for-tax-evasion\/\">tax evasion<\/a>.\u201d<\/p>\n<p>Little reminder: Any money earned, no matter where or how, should be reported to the IRS as income, and of course this includes cash. In some instances, those who have household employees might be responsible for withholding taxes, depending on the specific circumstances. According to the IRS, household employees include \u201chousekeepers, maids, babysitters, gardeners and others who work in or around your private residence\u2026\u201d<\/p>\n<p>There are three basic areas of consideration when determining whether it is your responsibility to withhold taxes on the money you pay as a matter of running your household. These areas are influence on work being done, relationship to the person doing the work and the amount of money paid out, as outlined in the following:<\/p>\n<ul>\n<li><strong>Influence on work<\/strong>\u2013 First determine whether the person doing the work for you is a household employee or an independent contractor by determining which of these two scenarios best describes your situation. Please note, independent contractors are responsible for paying <a href=\"https:\/\/www.hrblock.com\/tax-center\/small-business\/self-employed\/self-employment-tax\/\">self-employment taxes<\/a>.\n<ul>\n<li>Individuals you pay for various household work or services, such as people you call in to make repairs, are generally either\u00a0<a href=\"https:\/\/www.hrblock.com\/tax-center\/small-business\/self-employed\/self-employment-tax\/\">independent contractors<\/a> or the employee of someone else, and you don\u2019t have influence and control on how they perform their jobs\u00a0<strong>OR<\/strong><\/li>\n<li>As an employer, you have influence and control on how the employee performs the work\n<ul>\n<li>If you determine the individual is your employee, then your relationship with the employee and the amount you pay the employee all are taken into account when determining if taxes must be deducted from wages<\/li>\n<li>Each employee should complete\u00a0Form I-9\u00a0to verify eligibility for employment and you should also make sure you have your employees\u2019 Social Security numbers<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<li><strong>Relationship<\/strong>\u2013 You do not have to withhold taxes if the person you are paying is any of the following\n<ul>\n<li>Your spouse<\/li>\n<li>Your child, if under 21<\/li>\n<li>Your parent, if payment is being made in exchange for care given to your child who is either under 18 or needs care for at least four consecutive weeks in a quarter due to a physical or mental condition<\/li>\n<li>Anyone under 18<\/li>\n<\/ul>\n<\/li>\n<li><strong>Amount<\/strong>\u2013 You must withhold Social Security and Medicare taxes if you paid your employee at least $1,800 annually (2012 threshold)\n<ul>\n<li>You\u2019re not required to withhold federal income tax, but you may do so if your employee gives you a completed\u00a0<a href=\"https:\/\/www.hrblock.com\/tax-center\/irs\/forms\/how-to-fill-out-a-w-4\/\">W-4<\/a>\u00a0requesting these taxes be withheld<\/li>\n<li>You\u2019re required to pay federal unemployment taxes if the total wages paid to all your household employees is $1,000 or more in a quarter\n<ul>\n<li>Many states also have unemployment tax requirements.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>If you determine you have a household payroll, you must report the income paid on your tax return. Do this by submitting\u00a0<a href=\"http:\/\/www.irs.gov\/pub\/irs-pdf\/f1040sh.pdf\">Schedule H<\/a>, which calculates the federal employment taxes on those wages. Also, you should file\u00a0<a href=\"https:\/\/www.hrblock.com\/tax-center\/irs\/forms\/how-to-read-a-w2-form\/\">Form W-2<\/a>\u00a0with the IRS for each employee and give each employee a copy.<\/p>\n<p>Whether your household employees are seasonal or work for you year-round, having this extra help could result in needing the assistance of financial professionals. Depending on the number of people you employ, it may be beneficial to seek the advice of a professional bookkeeper. And, as are many tax laws, this is a complex issue that could make it beneficial for you to consult a\u00a0<a href=\"https:\/\/www.hrblock.com\/tax-offices\/local-offices\/#!\/en\/office-locator\/\">tax professional<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Having help around the house over the summer can lighten your load, but you need to understand your possible tax responsibilities for paying the babysitter or the person who mows your lawn. Discussion on this topic, which is often called \u201cthe nanny tax,\u201d generally focuses on how many taxpayers ignore these responsibilities and subsequently engage [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":26792,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[25,53],"tags":[],"class_list":["post-26791","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-irs","category-tax-responsibilities"],"acf":[],"yoast_head":"<title>The Nanny Tax - What You Need To Know | H&amp;R Block<\/title>\n<meta name=\"description\" content=\"Do you need to withhold taxes for your household employees? Learn more about the &quot;nanny tax&quot; and whether it applies to you at H&amp;R Block.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Nanny Tax: Paying Babysitters And Other Household Employees\" \/>\n<meta property=\"og:description\" content=\"Do you need to withhold taxes for your household employees? Learn more about the &quot;nanny tax&quot; and whether it applies to you at H&amp;R Block.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/\" \/>\n<meta property=\"og:site_name\" content=\"H&amp;R Block\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/hrblock\" \/>\n<meta property=\"article:author\" content=\"https:\/\/www.facebook.com\/hrblock\" \/>\n<meta property=\"article:published_time\" content=\"2012-05-29T17:53:31+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-04-05T21:34:18+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/08\/Money4-825x510.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"825\" \/>\n\t<meta property=\"og:image:height\" content=\"510\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Allie Freeland\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@hrblock\" \/>\n<meta name=\"twitter:site\" content=\"@hrblock\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Allie Freeland\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/\",\"url\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/\",\"name\":\"The Nanny Tax - What You Need To Know | H&R Block\",\"isPartOf\":{\"@id\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/08\/Money4-825x510.jpg\",\"datePublished\":\"2012-05-29T17:53:31+00:00\",\"dateModified\":\"2022-04-05T21:34:18+00:00\",\"author\":{\"@id\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/#\/schema\/person\/947cae86187966f0f06d688da80a2de6\"},\"description\":\"Do you need to withhold taxes for your household employees? Learn more about the \\\"nanny tax\\\" and whether it applies to you at H&R Block.\",\"breadcrumb\":{\"@id\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/#primaryimage\",\"url\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/08\/Money4-825x510.jpg\",\"contentUrl\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/08\/Money4-825x510.jpg\",\"width\":825,\"height\":510},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Nanny Tax: Paying Babysitters And Other Household Employees\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/#website\",\"url\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/\",\"name\":\"H&amp;R Block\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/#\/schema\/person\/947cae86187966f0f06d688da80a2de6\",\"name\":\"Allie Freeland\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/07\/Allie-Freeland-Headshot-150x150.jpg\",\"contentUrl\":\"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/07\/Allie-Freeland-Headshot-150x150.jpg\",\"caption\":\"Allie Freeland\"},\"description\":\"Allie is the Contributing Editor of the H&amp;R Block blog, Block Talk. She has been a practicing grammar geek since 2007.\",\"sameAs\":[\"http:\/\/blogs.hrblock.com\/\",\"https:\/\/www.facebook.com\/hrblock\",\"https:\/\/x.com\/hrblock\"]}]}<\/script>","yoast_head_json":{"title":"The Nanny Tax - What You Need To Know | H&R Block","description":"Do you need to withhold taxes for your household employees? Learn more about the \"nanny tax\" and whether it applies to you at H&R Block.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/","og_locale":"en_US","og_type":"article","og_title":"Nanny Tax: Paying Babysitters And Other Household Employees","og_description":"Do you need to withhold taxes for your household employees? Learn more about the \"nanny tax\" and whether it applies to you at H&R Block.","og_url":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/","og_site_name":"H&amp;R Block","article_publisher":"https:\/\/www.facebook.com\/hrblock","article_author":"https:\/\/www.facebook.com\/hrblock","article_published_time":"2012-05-29T17:53:31+00:00","article_modified_time":"2022-04-05T21:34:18+00:00","og_image":[{"url":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/08\/Money4-825x510.jpg","width":825,"height":510,"type":"image\/jpeg"}],"author":"Allie Freeland","twitter_card":"summary_large_image","twitter_creator":"@hrblock","twitter_site":"@hrblock","twitter_misc":{"Written by":"Allie Freeland","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/","url":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/","name":"The Nanny Tax - What You Need To Know | H&R Block","isPartOf":{"@id":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/#website"},"primaryImageOfPage":{"@id":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/#primaryimage"},"image":{"@id":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/#primaryimage"},"thumbnailUrl":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/08\/Money4-825x510.jpg","datePublished":"2012-05-29T17:53:31+00:00","dateModified":"2022-04-05T21:34:18+00:00","author":{"@id":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/#\/schema\/person\/947cae86187966f0f06d688da80a2de6"},"description":"Do you need to withhold taxes for your household employees? Learn more about the \"nanny tax\" and whether it applies to you at H&R Block.","breadcrumb":{"@id":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/#primaryimage","url":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/08\/Money4-825x510.jpg","contentUrl":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/08\/Money4-825x510.jpg","width":825,"height":510},{"@type":"BreadcrumbList","@id":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/irs\/tax-responsibilities\/nanny-tax-guide\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/"},{"@type":"ListItem","position":2,"name":"Nanny Tax: Paying Babysitters And Other Household Employees"}]},{"@type":"WebSite","@id":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/#website","url":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/","name":"H&amp;R Block","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/#\/schema\/person\/947cae86187966f0f06d688da80a2de6","name":"Allie Freeland","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/#\/schema\/person\/image\/","url":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/07\/Allie-Freeland-Headshot-150x150.jpg","contentUrl":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-content\/uploads\/2017\/07\/Allie-Freeland-Headshot-150x150.jpg","caption":"Allie Freeland"},"description":"Allie is the Contributing Editor of the H&amp;R Block blog, Block Talk. She has been a practicing grammar geek since 2007.","sameAs":["http:\/\/blogs.hrblock.com\/","https:\/\/www.facebook.com\/hrblock","https:\/\/x.com\/hrblock"]}]}},"_links":{"self":[{"href":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-json\/wp\/v2\/posts\/26791","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-json\/wp\/v2\/comments?post=26791"}],"version-history":[{"count":0,"href":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-json\/wp\/v2\/posts\/26791\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-json\/wp\/v2\/media\/26792"}],"wp:attachment":[{"href":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-json\/wp\/v2\/media?parent=26791"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-json\/wp\/v2\/categories?post=26791"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hrbcomlnp.hrblock.com\/tax-center\/wp-json\/wp\/v2\/tags?post=26791"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}