Percentage withheld for Medicare and social security

[Anonymous]

I am having a bit of a nightmare with my new nanny. We agreed to withhold all taxes. She now disputes the tax rates we are withholding at based on the allowances on Federal and MD tax forms. So, nanny asked me to stop withholding. I can't stop withholding Medicare and social security. She feels that I am withholding too much of those taxes too. I will call my accountant tomorrow to double check my numbers. What percentage do you withhold for Medicare and social security? I think I need to use a nanny tax service. These arguments are too much.

[Anonymous]

Didn't she fill out a W-2 before she started? Withholding should be based on that. I would use a tax service since it's simpler but you can also tell her that if you are withholding too much she will get it back in her return later.

[Anonymous]

If you aren't sure what you're doing, then you need to use a service. If my nanny came to me with these complaints, I could sit down with her with the W4 and the computer and very quickly show her exactly how I calculate her withholding each pay period, showing her the tax tables. There would be no continued arguing, because I know I'm doing it correctly. If she still didn't believe it, I'd send her to an accountant at her her own expense to have someone else tell her the exact same thing.

But to answer your question, currently, Medicare is 1.45% and Social Security is 6.2% of wages. You will pay an equivalent amount when you pay your employer taxes.

[Anonymous]

Anonymous wrote:Didn't she fill out a W-2 before she started? Withholding should be based on that. I would use a tax service since it's simpler but you can also tell her that if you are withholding too much she will get it back in her return later.

W4, not W-2.

[Anonymous]

Withholding is based on the Form W-4 she should have filled out.

[nannydebsays]

You can use one of the Nanny Tax companies tax calculators for free, and print out the results to show her. If she filled out her W4 correctly, the withholding info will be there for you to use.

SS/Medicare is 7.65% of her gross pay.

[Anonymous]

Did your nanny explain to you why she thinks you are withholding too much? Was she on a similar paying job before but got more money after the withholdings? Id just sit with her and use the one of the free nanny pay calculators to explain the numbers

[Anonymous]

SS/Medicare is the same for everybody (up to the cap). Point it out to her chapter and verse on the IRS website. It sounds to me like she wanted to be grossed up and is regretting the deal she made and is hoping you'll agree to go under the table.