FAQ's
- What are nanny taxes?
- What are the nanny tax deadlines?
- Why should I pay nanny taxes?
- Am I required to pay nanny taxes?
- How much do nanny taxes cost the employer?
- How do I know how much to pay my nanny?
- How can I save money by paying nanny taxes?
- Can the IRS catch me if I haven’t paid nanny taxes?
- When do I pay my nanny taxes?
- Am I required to withhold federal and state income taxes?
- What are unemployment taxes?
- What are the penalties if I file withholding taxes late?
- Do I have to pay my employee overtime?
- I live in New York, do I have to pay my employee each week?
- I have a nanny on a trial basis. When do I have to start paying taxes?
- Can I hire an illegal alien?
- I’m in a nanny share, how do the taxes work?
- I am a nanny, how do I pay my taxes?
- Is Your Household Worker an Employee?
- Why Isn’t My Household Worker an Independent Contractor?
- Why Can’t I Hire My Nanny as an Independent Contractor?
- What Does the Employer Need to do to Pay Nanny Taxes?
- What Do Nannies Need to Provide to Their Family?
- What Are the Risks of Paying Your Nanny “Under the Table”?
- How Much Work Does It Take to Correctly Administer Nanny Taxes?
- What Forms and Payment are Needed to Comply with Nanny Tax Law?
How can I save money by paying nanny taxes?
There are tax breaks available for families employing a nanny which may reduce their nanny tax costs. You may be able to use a Flexible Spending Account offered by your employer or the Child & Dependent Care tax credit. These tax breaks are only available to you if you pay your nanny legally.
The Flexible Spending Account (FSA). You may be able to withhold pre-tax money from your paycheck in order to reimburse yourself for dependent care costs. With this option, you may reduce or completely offset your nanny tax costs! Check with your employer to see if they offer this “cafeteria plan” benefit.
OR
The Child & Dependent Care tax credit. This is a credit that can reduce your federal income taxes when you file your federal tax return. In order to use this credit, you must meet certain requirements. See IRS Publication 503 for more information.
Because there are restrictions on each of these options according to federal law, you must be sure to investigate your eligibility.
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