Nanny does not want to file taxes

[Anonymous]

Anonymous wrote:It depends on how much she makes and what state you are in. If it doesn't hit the limit of monthly income then she doesn't have to file. Yes this is true and look it up. I have.

Last I knew, you had to disclose income to the IRS if the nanny made more than $1800 (maybe $1900?) during a quarter. There are very few nannies who don't make that much.

Ex:
10 hours per week at $15/hour: 10*15= $150
$150 per week for 52 weeks per year: $150*52=$7,800
divide into quarters: $7,800/4= $1,950

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You are not her slavemaster so please don't try to control her. She told you how she wants to be paid so please do it.

If it were only about the nanny's wishes, like check versus direct deposit, that would be fine. But this nanny is asking OP to break the law. And while the nanny would have to pay back taxes and fines if she were caught, OP would face much bigger fines, possibly jail time. Tax evasion is a felony, not filing your return is just a misdemeanor.

OP faces no penalty because it is up to nanny to file taxes if she wishes. If what you say was true no company would ever hire a contractor for fear they might not pay their own taxes and the company gets held liable! Think it through my dear.

It's up to the nanny to file taxes so the nanny will have her own reckoning with the IRS. That won't be the OP's problem. The OP's problem will be that she hasn't filed the EMPLOYER taxes. The OP is liable for the employer's share of taxes, and nanny for her own.

OP here. Thanks for the response above. Yes, I am happy to pay my part of the employer taxes (social security and medicare and unemployment taxes). But the Nanny wants to be paid cash. My question is if I agree to pay her cash, meaning I need to go to the bank to draw cash to pay her, and I also pay my employer taxes, will I get her into trouble if she didn't pay for her share of employee taxes (social security and medicare and unemployment taxes) as well as income taxes.

It doesn't work that way - as the employer you send to the IRS BOTH your share and her share of social security and medicare, and you pay unemployment taxes. You are entitled to collect the nanny's ss/medicare and if you don't collect YOU are still on the hook. Her Income Taxes are her responsibility. You can deduct them for her, or not.

[Anonymous]

Anonymous wrote:

Anonymous wrote:It depends on how much she makes and what state you are in. If it doesn't hit the limit of monthly income then she doesn't have to file. Yes this is true and look it up. I have.

Last I knew, you had to disclose income to the IRS if the nanny made more than $1800 (maybe $1900?) during a quarter. There are very few nannies who don't make that much.

Ex:
10 hours per week at $15/hour: 10*15= $150
$150 per week for 52 weeks per year: $150*52=$7,800
divide into quarters: $7,800/4= $1,950

It's $1900 per year, not quarter.

That being said technically the nanny is responsible and on the hook for taxes all money earned, no matter if it didn't meet the threshold for the family to file or not. A lot of nannies think they don't need to include this income.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:It depends on how much she makes and what state you are in. If it doesn't hit the limit of monthly income then she doesn't have to file. Yes this is true and look it up. I have.

Last I knew, you had to disclose income to the IRS if the nanny made more than $1800 (maybe $1900?) during a quarter. There are very few nannies who don't make that much.

Ex:
10 hours per week at $15/hour: 10*15= $150
$150 per week for 52 weeks per year: $150*52=$7,800
divide into quarters: $7,800/4= $1,950

It's $1900 per year, not quarter.

That being said technically the nanny is responsible and on the hook for taxes all money earned, no matter if it didn't meet the threshold for the family to file or not. A lot of nannies think they don't need to include this income.

I know that nannies have to report either way, but I thought that families only had to report if they hit $1.900 per quarter. Thanks for the correction

[CPPatGTM]

This is actually very common. Unfortunately, the penalties would fall on you, as the employer, if it is determined that you did not comply with state and federal law.

All household employers are required to pay taxes based on the employee's gross earnings. Additionally, they must withhold the required federal taxes of Social Security and Medicare from the employee's wages, or pay them on their behalf once $1,900 or more is paid ($2,000 in 2016).

Lets say your employee decides to apply for unemployment benefits upon termination. If the state does not see the wages reported in their system, and required taxes are not paid accordingly, you will be subject to fines as well as back tax work to bring everything current.

Additionally, you and the employee are required to file specific tax forms if the above threshold is met at the end of each year. Again, if it is determined that you and the employee did not comply by law, your employee may have future wages garnished by various tax agencies.

GTM has specialized in household employment for 25 years, and have dealt with similar cases after such penalties took place. If you're interested in learning more about your obligations, please feel free to contact us so that we can see how we can help!

[Anonymous]

Anonymous wrote:You are not her slavemaster so please don't try to control her. She told you how she wants to be paid so please do it.

Let's rephrase that. The nanny would like to break the law and is demanding her employer do the same. No. Too bad nanny wants to break the law. She is not entitled to request her employer behave in an illegal and immoral manner just because this is how she wants to be paid.

Move on to a more ethical and law abiding nanny, OP. There are many great candidates out there.

[Anonymous]

Unfortunately, most nanny employers still refuse to pay on the books. Most of the "domestic" industry is under the table. Government doesn't have the resources to crack down on these people. Go to any wealthy neighborhood, and few of these workers can show you a pay stub of any sort.

[Anonymous]

Anonymous wrote:Unfortunately, most nanny employers still refuse to pay on the books. Most of the "domestic" industry is under the table. Government doesn't have the resources to crack down on these people. Go to any wealthy neighborhood, and few of these workers can show you a pay stub of any sort.

OP wants to pay on the books. Solution is that OP finds a nanny willing to be paid legally, and their candidate can go find someone that likes breaking the law.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Unfortunately, most nanny employers still refuse to pay on the books. Most of the "domestic" industry is under the table. Government doesn't have the resources to crack down on these people. Go to any wealthy neighborhood, and few of these workers can show you a pay stub of any sort.

OP wants to pay on the books. Solution is that OP finds a nanny willing to be paid legally, and their candidate can go find someone that likes breaking the law.

Op is in the minority of nanny employers. There are some good nannies who demand legal payment, but they cost more.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Unfortunately, most nanny employers still refuse to pay on the books. Most of the "domestic" industry is under the table. Government doesn't have the resources to crack down on these people. Go to any wealthy neighborhood, and few of these workers can show you a pay stub of any sort.

OP wants to pay on the books. Solution is that OP finds a nanny willing to be paid legally, and their candidate can go find someone that likes breaking the law.

Op is in the minority of nanny employers. There are some good nannies who demand legal payment, but they cost more.

Yes and no. About half of the employers I contact are willing to pay on the books, but sometimes they've never had a nanny ask to do so.

[Anonymous]

Open a new search, and this time part of the advertisement says "will not pay under the table, will only pay legally". This way you only get candidates to fall in love with who are willing to do it the legal way. My friend is a lawyer - no way could she have ever paid under the table to her full time nanny! So she was very clear in her working with a nanny agency - she had to pay legally, only send me candidates who want this.

Because it's so hard to find someone you love but can't hire! But you will find someone else who is a great nanny.

[Anonymous]

She may be receiving some form of financial assistance/aid from the Govt. and it may not be enough to comfortably live off of. Perhaps she is food poor and needs to make a little extra cash so she doesn't go hungry.

I would ask her why and see what she says.

If you can see her perspective on things, then I would simply pay her in cash.

But if you don't feel comfortable doing so, than it is your right to let her go and find someone else who wouldn't mind following the law more.

It's entirely up to YOU, good luck.

[Anonymous]

Anonymous wrote:She may be receiving some form of financial assistance/aid from the Govt. and it may not be enough to comfortably live off of. Perhaps she is food poor and needs to make a little extra cash so she doesn't go hungry.

I would ask her why and see what she says.

If you can see her perspective on things, then I would simply pay her in cash.

But if you don't feel comfortable doing so, than it is your right to let her go and find someone else who wouldn't mind following the law more.

It's entirely up to YOU, good luck.

Um no, no and no. I've been cash strapped and applied for food stamps. You are required to declare every penny of income you receive, earned (salary) or unearned (child support). Nannies aren't eligible for extra money compared to anyone else, and anyone who lies about the amount of money they declare can be required to pay back benefits, which would make the situation even worse.