Night nanny tax question

[Anonymous]

Hi everyone,

Our first baby is due this fall, and we have worked with an agency to find a night nanny who will come 4 days a week for 8 hours per day (over a 3 month period). The agency says that we pay them and that they issue a 1099 to the nanny.

Is this acceptable for the night nanny to be treated as an independent contractor?

[Anonymous]

Probably not. Sounds like an employee to me if she’s coming for a set number of hours and a set number of days. You will need to pay employers portion of social security and fica.

[Anonymous]

Anonymous wrote:Probably not. Sounds like an employee to me if she’s coming for a set number of hours and a set number of days. You will need to pay employers portion of social security and fica.

This. That she works nights is irrelevant.

[Anonymous]

Think this is how it works for all 1099s???

[Anonymous]

Is this WHN?

[Anonymous]

Is she a newborn care specialist? If so, 1099 is industry standard.

[Anonymous]

If you are working with the agency to provide night nanny services for fixed period, then she is their employee. If you hired a person through an agency she is your employee.
Your agency may consider her your employee but what you pay them includes your taxes and will be indicated on the 1099. Find out.

[Anonymous]

She's a 1099 employee. Your contract is with the agency.

[Anonymous]

With the hours listed and an assumed salary that the nanny will surpass either the quarter or yearly monetary threshold set for household employees by the IRS, it really seems the agency is misclassifying its employees as 1099s vs W-2s, which seems to be the norm for these types of gigs. Whether this will come back to haunt you with an IRS audit, it’s up to you to take the risk since the IRS is very clear on the regulations for household employees.

[Anonymous]

Anonymous wrote:She's a 1099 employee. Your contract is with the agency.

She is not a 1099 employee if she is getting paid directly by OP.

[Anonymous]

Anonymous wrote:

Anonymous wrote:She's a 1099 employee. Your contract is with the agency.

She is not a 1099 employee if she is getting paid directly by OP.

I’m not the OP but she says she is paying the agency, not the nanny. We have the same arrangement and pay the agency. The agency presumably takes a cut of the pay; that info is not shared with families.

[Anonymous]

Here is some info to help you figure it out:

https://www.irs.gov/businesses/small-businesses-self-employed/statutory-nonemployees

"Companion sitters. Companion sitters are individuals who furnish personal attendance, companionship, or household care services to children or to individuals who are elderly or disabled. A person engaged in the trade or business of putting the sitters in touch with individuals who wish to employ them (that is, a companion sitting placement service) won't be treated as the employer of the sitters if that person doesn't receive or pay the salary or wages of the sitters and is compensated by the sitters or the persons who employ them on a fee basis. Companion sitters who aren't employees of a companion sitting placement service are generally treated as self-employed for all federal tax purposes. However, the companion sitter may be an employee of the individual for whom the sitting services are performed; see Pub. 926."

Since the agency does receive the pay from the client and pays the sitter, the agency appears to be the sitter's employer (W-2, not 1099).

[Anonymous]

This is super dicey. Is the night nanny a "companion" under the law, or a babysitter/nanny?

https://www.irs.gov/taxtopics/tc756

https://www.dol.gov/agencies/whd/fact-sheets/79a-flsa-companionship

[Anonymous]

Is she a Postpartum doula or NCS? Sounds like employee if she is schedule to cover overnights W2 32hours/weekly; the agency charges you but you’re responsable for her salary therefore pay her on the books and ask her directly if she has a LLC(some doulas/NCS have their own business name and take Venmo /paypal account and they’re responsable for their own taxes)

[Anonymous]

Anonymous wrote:Is she a Postpartum doula or NCS? Sounds like employee if she is schedule to cover overnights W2 32hours/weekly; the agency charges you but you’re responsable for her salary therefore pay her on the books and ask her directly if she has a LLC(some doulas/NCS have their own business name and take Venmo /paypal account and they’re responsable for their own taxes)

We use an agency and paying the NCS directly is not an option because the rate we pay does not go entirely to the NCS. The agency would make no money if we paid her directly.