Extortion - how to deal with?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Well you sound pretty dumb for not putting a contract in place.

. There was a contract in place in terms of a written text agreement but it was loosely based on a typical amount of hours driving and a monthly wage for this. If they wanted more they had the entire year to request it but they didn’t. There are no requests for additional money till now.

This won’t hold up in court for an hourly employee in VA.

So an hourly employee can ask for more money years later? Is that what you are saying?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

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Anonymous wrote:

Anonymous wrote:If I'm understanding correctly, you hired a babysitter. You paid that person under the table. Employers are responsible for paying taxes. A household employee cannot be an independent contractor. But you won't go to jail. You will have to pay what you owe to the government, and there will probably be penalties.

https://www.irs.gov/publications/p926#en_US_2023_publink100086725

How would OP pay the payroll taxes now if she doesn’t have the person’s SSN? Does the IRS just apply the funds based on the name OP supplies?

Heck, we don't even know if this person has the authorization to work because OP didn't do any of this. But the point is that all this person has to do is make a claim with the state of Virginia and OP is in hot water.

To pay payroll taxes on a babysitter for one to two hours of school? I admit I might have to pay taxes but I don’t need a babysitter anymore so it’s no longer a need and didn’t know this was an issue legitimately. I assume I would just have to pay the taxes along with penalties if the IRS came knocking. Which would likely be less than what is being asked to pay extra. I think the IRS understands part time childcare well enough to not put people in jail over some babysitting hours.

PP didn’t say you would go to jail. They are referring to the law in VA where the employee can sue you personally. You’ll be on the hook for all costs, including their legal fees. In VA the presumption is the person is an employee. You would then owe all back taxes on top of the judgement and costs.

The issue in this case is you said you have no documentation. So nothing in writing about her wage and hours that she worked per day? This person could make up anything and you’ll have to prove they are lying.

No there is documentation on monthly wages and receipts of payments. What is in it for them? They likely didn’t claim the money and it’s clear they were paid what is in writing. What do they get out of taking me to court? All the wages have been paid. Wouldn’t the discussion just be about taxes to the government?

You have no documentation- nothing on hours worked, nothing on wages to be paid. What’s in it for them is wage theft. They’ll claim they worked more hours or earned more per hour and you didn’t pay. How will you dispute that in court?

You have more to lose then them being late on filing taxes for last year.

How will they say that if they have no proof of additional hours and there is proof that they charged an hourly rate above minimum wage and agreed to a monthly rate which was paid. There is clear documentation of them asking for a monthly wage and receiving it.

They would be an hourly employee in Va. It would be very easy to create a log of hours that exceed your 1-2 hours per day and claim they worked it. Do you have timesheets or payroll statements with hours worked as required in Va? Did you pay them at least twice a month as required in Va? You keep saying monthly so I’m not sure if you are summing two payments or if you only paid once a month.

They asked for the money once a month.

Doesn’t matter. The law said you had to pay twice a month.

What about the timesheets and written pay statements referencing hours worked?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If I'm understanding correctly, you hired a babysitter. You paid that person under the table. Employers are responsible for paying taxes. A household employee cannot be an independent contractor. But you won't go to jail. You will have to pay what you owe to the government, and there will probably be penalties.

https://www.irs.gov/publications/p926#en_US_2023_publink100086725

How would OP pay the payroll taxes now if she doesn’t have the person’s SSN? Does the IRS just apply the funds based on the name OP supplies?

Heck, we don't even know if this person has the authorization to work because OP didn't do any of this. But the point is that all this person has to do is make a claim with the state of Virginia and OP is in hot water.

To pay payroll taxes on a babysitter for one to two hours of school? I admit I might have to pay taxes but I don’t need a babysitter anymore so it’s no longer a need and didn’t know this was an issue legitimately. I assume I would just have to pay the taxes along with penalties if the IRS came knocking. Which would likely be less than what is being asked to pay extra. I think the IRS understands part time childcare well enough to not put people in jail over some babysitting hours.

PP didn’t say you would go to jail. They are referring to the law in VA where the employee can sue you personally. You’ll be on the hook for all costs, including their legal fees. In VA the presumption is the person is an employee. You would then owe all back taxes on top of the judgement and costs.

The issue in this case is you said you have no documentation. So nothing in writing about her wage and hours that she worked per day? This person could make up anything and you’ll have to prove they are lying.

No there is documentation on monthly wages and receipts of payments. What is in it for them? They likely didn’t claim the money and it’s clear they were paid what is in writing. What do they get out of taking me to court? All the wages have been paid. Wouldn’t the discussion just be about taxes to the government?

You have no documentation- nothing on hours worked, nothing on wages to be paid. What’s in it for them is wage theft. They’ll claim they worked more hours or earned more per hour and you didn’t pay. How will you dispute that in court?

You have more to lose then them being late on filing taxes for last year.

How will they say that if they have no proof of additional hours and there is proof that they charged an hourly rate above minimum wage and agreed to a monthly rate which was paid. There is clear documentation of them asking for a monthly wage and receiving it.

They would be an hourly employee in Va. It would be very easy to create a log of hours that exceed your 1-2 hours per day and claim they worked it. Do you have timesheets or payroll statements with hours worked as required in Va? Did you pay them at least twice a month as required in Va? You keep saying monthly so I’m not sure if you are summing two payments or if you only paid once a month.

They asked for the money once a month.

Doesn’t matter. The law said you had to pay twice a month.

What about the timesheets and written pay statements referencing hours worked?

There are no timesheets. Just agreements on approximate hours and monthly charges.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Well you sound pretty dumb for not putting a contract in place.

. There was a contract in place in terms of a written text agreement but it was loosely based on a typical amount of hours driving and a monthly wage for this. If they wanted more they had the entire year to request it but they didn’t. There are no requests for additional money till now.

This won’t hold up in court for an hourly employee in VA.

So an hourly employee can ask for more money years later? Is that what you are saying?

You’re avoiding answering specific questions. Did you have timesheets for this person and did you provide written pay statements referencing hours worked? If you did that is exactly how employees file wage theft claims.

Remember you are starting from the position of having done everything wrong. It’s very easy to side with a misclassified employee when looking at an employer that avoided paying taxes and complying with Wage and Hour laws.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Well you sound pretty dumb for not putting a contract in place.

. There was a contract in place in terms of a written text agreement but it was loosely based on a typical amount of hours driving and a monthly wage for this. If they wanted more they had the entire year to request it but they didn’t. There are no requests for additional money till now.

This won’t hold up in court for an hourly employee in VA.

So an hourly employee can ask for more money years later? Is that what you are saying?

You’re avoiding answering specific questions. Did you have timesheets for this person and did you provide written pay statements referencing hours worked? If you did that is exactly how employees file wage theft claims.

Remember you are starting from the position of having done everything wrong. It’s very easy to side with a misclassified employee when looking at an employer that avoided paying taxes and complying with Wage and Hour laws.

Ok sorry you answered as I was writing.

Look, I think you should gamble and ignore them. But if they pursue you, get a lawyer because you’ll be in major hot water.

[Anonymous]

I guess I’ll see what my options are. Maybe it’s not worth hassling about.

[Anonymous]

Anonymous wrote:Yes a contract dispute but over something that isn’t remotely real. They say some third party person was involved that needs to be paid that we’ve never heard of or dealt with. The person we hired was a local friend of a friend. The agreement was verbal based on daily care and has been going on for a long time with no issue only documenting monthly payments which were accepted without issue. At the time of termination was when all of these accusations for more money came to surface saying more hours and more people needed to be paid to settle up but there is no actual documentation stating any of this.

Is the third party an agency? Did your friend recommend someone who they previously got through an agency? Because you can’t do that, you have to go through the agency, but that’s on your friend, not you.

[Anonymous]

Op did you 1099 the nanny or claim her on your taxes? If so, yes you owe her money because you messed with her taxes. Nannies are household employees.

[Anonymous]

Anonymous wrote:They mainly worked as an Uber service for kids to an activity driving their own car.

Did you pay mileage?

[Anonymous]

Anonymous wrote:

Anonymous wrote:They mainly worked as an Uber service for kids to an activity driving their own car.

Did you pay mileage?

She has her own business with a friend and I hired her by the hour which I was told included mileage. Then we agreed on a set number of hours per month.

[Anonymous]

Anonymous wrote:Op did you 1099 the nanny or claim her on your taxes? If so, yes you owe her money because you messed with her taxes. Nannies are household employees.

No. No claim. She also wasn’t a nanny. She was a driver

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:They mainly worked as an Uber service for kids to an activity driving their own car.

Did you pay mileage?

She has her own business with a friend and I hired her by the hour which I was told included mileage. Then we agreed on a set number of hours per month.

What does your contract say? Is this business incorporated? She sent you monthly invoices? You keep saying business but it sounds as if you just paid a person.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Op did you 1099 the nanny or claim her on your taxes? If so, yes you owe her money because you messed with her taxes. Nannies are household employees.

No. No claim. She also wasn’t a nanny. She was a driver

Were your children in her care? That makes her a nanny. You seem to think that you can just say “she wasn’t a nanny” and it magically makes her not a nanny.

[Anonymous]

Just curious, not OP, but what does nanny have to do with this. They hired a driver to drop off and pick up. Did the driver provide snacks? Physically escort the kid? If I hire an Uber, I am not hiring a nanny. What was in the contract? What was in the verbal agreement? This person was being paid $400/month and seemed ok with it. Why are the now asking for more after the fact?

[Anonymous]

Anonymous wrote:Just curious, not OP, but what does nanny have to do with this. They hired a driver to drop off and pick up. Did the driver provide snacks? Physically escort the kid? If I hire an Uber, I am not hiring a nanny. What was in the contract? What was in the verbal agreement? This person was being paid $400/month and seemed ok with it. Why are the now asking for more after the fact?

I believe that in Washington DC you are required by law to reimburse a nanny for mileage. And in most places it is a good and normal practice. OP is trying to use semantics to get out of this. She’s a cheapskate who failed to pay employer taxes.