Paying for Childcare as Federal Employee

[Anonymous]

Anonymous wrote:We pay our cleaners with a check. I have no idea whether they report the income but I don't see it as my problem any more so than when I hire people for repairs or other work on the house.

That's not how household employees work.

[Anonymous]

Anonymous wrote:What does you being a federal employee have to do with childcare?

It shouldn’t. But they’re considering something shady.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We pay our cleaners with a check. I have no idea whether they report the income but I don't see it as my problem any more so than when I hire people for repairs or other work on the house.

Wrong. A house cleaner needs to be on the books if they earn $2,400 or more in any given year.

We file social security, Medicare and unemployment taxes for our cleaner, plus maintain a worker’s comp policy.

I think we are just under that at $180 once per month. Not sure I see the distinction though between a house cleaner or a repair person I hire for a big job (over 2400) and no one puts a repair person or company on payroll. The housekeepers don't seem like they would pass the employee test because they don't take direction from us (they dont even talk to us) and they supply their own tools.

The distinction is between hiring people who are employees of another company (cleaning company, plumbing company, HVAC company) and hiring an individual. If you are hiring an individual who does not work for a company that is providing them a W2, then the $2500 limit comes into effect. If you are really only paying $180/month, you are under that amount and don’t have to pay on the books. Most people will go over that amount for a regular housecleaner. Most people with security clearances will not even engage in such an arrangement if they will get close to the limit because a mistake could cost them their clearance.

In the case of a cleaner though wouldn't it only be a 1099? They come when they want (once per month but they pick the day and time), take no direction from me (they are firm that their services encompass xyz and that's it), provide their own tools. When I look at the IRS test everything points to a contractor or just doesn't apply at all.

This is what I would expect unless they were a live in/full time type maid. And would the cleaner in this case just be a sole proprietor responsible for their own taxes?

[Anonymous]

Anonymous wrote:OP- if you happen to be in Chicago, I can help you find someone

Thank you! How might I be able to get a hold of you?

[Anonymous]

For cleaner - our person comes 1 time a week for 4 hours.
She is thrilled that someone is paying her on the books b/c she is able to qualify for SS
She is also able to get a car loan / mortgage since it is fully reported

We found our person through a neighbor.

For childcare, any chance anyone from the aftercare program would want extra income? You might be able to get this so that you do not hit the limit if it is only a few hours a week and pay it more like a babysitter. (Distinction I am making - babysitter is not going to hit the threshold)

[Anonymous]

Anonymous wrote:

Anonymous wrote:What does you being a federal employee have to do with childcare?

If you have to ask …

Yeah….I was gona say, must not be a fed.

You have to do a nanny share or pay more and be very clear you are only willing to pay legallyZ

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What does you being a federal employee have to do with childcare?

If you have to ask …

Yeah….I was gona say, must not be a fed.

You have to do a nanny share or pay more and be very clear you are only willing to pay legallyZ

Well, according to some "clearance gurus" in this thread, there are some feds who don't think there's any risk of paying people off the books and ignoring IRS regs.

[Anonymous]

Anonymous wrote:

Anonymous wrote:What does you being a federal employee have to do with childcare?

She has a low level security clearance which requires that she pay household employees above board - she must file taxes as an employer. No cash employee's for us.

Is that true even for babysitting?

[Anonymous]

Anonymous wrote:For cleaner - our person comes 1 time a week for 4 hours.
She is thrilled that someone is paying her on the books b/c she is able to qualify for SS
She is also able to get a car loan / mortgage since it is fully reported

We found our person through a neighbor.

For childcare, any chance anyone from the aftercare program would want extra income? You might be able to get this so that you do not hit the limit if it is only a few hours a week and pay it more like a babysitter. (Distinction I am making - babysitter is not going to hit the threshold)

Thank you! What you’re saying makes sense - split up these duties. I do have a cleaning service that comes bi-monthly, I can ask them if they can send their team more often and if they can do laundry too. On the childcare front, I haven’t had luck with the daycare or aftercare employees but I’ll try the local colleges and high schools.

When we lived in the city, it was really easy to find the help we needed and pay them above board. I’ve only had difficulty since moving to the suburbs!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What does you being a federal employee have to do with childcare?

She has a low level security clearance which requires that she pay household employees above board - she must file taxes as an employer. No cash employee's for us.

Is that true even for babysitting?

Like people have said upthread- it depends what you are calling “babysitting”. The teenager who comes on Saturday night- no. Someone who watches your child daily for 4 hours after school? Yes this would probably be over the dollar threshold quickly.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP- if you happen to be in Chicago, I can help you find someone

Thank you! How might I be able to get a hold of you?

PP here. Please feel free to email me at [e-mail]

[Anonymous]

Good luck, OP.

I am very curious how many people in this forum who constantly tell people to hire help treat their help as household employees, reporting wages and paying all required taxes?

It was a PTA when I used to do it.

(Note - I'm not talking about hiring a cleaning or lawn service company)