Message
FYI we publish state-specific information sheets for each of these states. You can download from here:
http://www.4nannytaxes.com/index.cfm/resources/news-and-updates/household-employment-rules-by-state/
Kathy Webb
HomeWork Solutions Inc.
http://www.4nannytaxes.com/index.cfm/resources/news-and-updates/household-employment-rules-by-state/
Kathy Webb
HomeWork Solutions Inc.
Anonymous wrote:Anonymous wrote:Anonymous wrote:A nanny is definitely NOT an independent contractor. Calling her that doesn't make it so, sorry.
http://blog.nettimesolutions.com/employers-misclassifying-independent-contractors/?goback=.gde_39688_member_257764227.gna_39688
Many of the newborn nannies are ICs. That's a fact.
They have many clients a year.
I would add that NCS have other accoutrements of a business too. They present the family with a contract typically, set their own rates, contract for a specific duration of time, etc. Many of these specialists have business cards, maintain their own websites, and often work in informal networks with other NCS where if one is booked the hand the job over to another NCS to pursue the opportunity. They also typically collect a retainer or deposit for the family to reserve the time which is non-refundable. Some families handle this conservatively and treat the NCS as an employee, yet I believe MOST situations a good case could be made for IC status if pressed. The IRS is the ultimate arbitrator - not the family or the NCS.
This is a very different situation from a regular nanny - even a summer nanny.
Kathy Webb
HomeWork Solutions/4nannytaxes.com
OP:
Employment taxes are an employer responsibility - these are Social Security, Medicare and unemployment taxes. You may chose to deduct your employee's portion (7.65% of gross) or decide to pay her portion in addition to your employer portion. If you fail to deduct you have decided to pay her portion for her! You can not have her submit her 7.65% and you submit your 7.65% separately - all the payments are due from you.
Individual income taxes are the employee's responsibility. You are NOT obligated to deduct the nanny's income taxes, and if you do not deduct you don't have any financial obligation for the income tax. Most employers with a full time nanny will offer to deduct income taxes to help the employee avoid a situation where she owes considerable taxes at year end.
The FAQ at 4nannytaxes.com steps you through this, and the paycheck calculator will do the computations for you.
Kathy Webb
HomeWork Solutions/4nannytaxes.com
Employment taxes are an employer responsibility - these are Social Security, Medicare and unemployment taxes. You may chose to deduct your employee's portion (7.65% of gross) or decide to pay her portion in addition to your employer portion. If you fail to deduct you have decided to pay her portion for her! You can not have her submit her 7.65% and you submit your 7.65% separately - all the payments are due from you.
Individual income taxes are the employee's responsibility. You are NOT obligated to deduct the nanny's income taxes, and if you do not deduct you don't have any financial obligation for the income tax. Most employers with a full time nanny will offer to deduct income taxes to help the employee avoid a situation where she owes considerable taxes at year end.
The FAQ at 4nannytaxes.com steps you through this, and the paycheck calculator will do the computations for you.
Kathy Webb
HomeWork Solutions/4nannytaxes.com
OP a nanny is your employee and if you pay her $500 or more in a calendar quarter you must report her wages and pay DC unemployment tax.
There is a discussion here: http://www.4nannytaxes.com/index.cfm/resources/news-and-updates/nanny-employee-or-contractor/
Kathy Webb
HomeWork Solutions/4nannytaxes.com
There is a discussion here: http://www.4nannytaxes.com/index.cfm/resources/news-and-updates/nanny-employee-or-contractor/
Kathy Webb
HomeWork Solutions/4nannytaxes.com
Rebecca:
1. For a full-time nanny, do you pay the nanny for all days/weeks of the year, including for days that the nanny is not needed (i.e., because one of the parents is home from work due to illness or vacation)?
Most full time nannies expect a guaranteed base pay every week, even if the family doesn't need her one or more days. This is not a requirement, however it is so common that if you do not plan to do this you should disclose in the interview and the work agreement so you don't end up with a very unhappy nanny somewhere down the road and have to replace with little/no notice. This is much less common for PT nannies. Make sure you state her pay in hourly rate terms, and if more than 40 hours are needed in a week do the math for regular and overtime rates. The Hourly Rate Calculator at 4nannytaxes.com will do the algebra for you!
3. Does anyone have a sample list of terms or a contract that you wrote with your nanny that you might be willing to share?
There are sample work agreements here: http://www.4nannytaxes.com/index.cfm/resources/forms/
Also state specific payroll and tax tip sheets can be downloaded from here: http://www.4nannytaxes.com/index.cfm/resources/news-and-updates/household-employment-rules-by-state/
4. Is there a good website that describes the responsibilities of the employer of a nanny, such as with respect to tax withholding?
Our FAQ has been developed from 20+ years of experience helping new household employers with their questions: http://www.4nannytaxes.com/index.cfm/faq/nannyhousekeeper-faq-list/
I hope that helps!
Kathy Webb
1. For a full-time nanny, do you pay the nanny for all days/weeks of the year, including for days that the nanny is not needed (i.e., because one of the parents is home from work due to illness or vacation)?
Most full time nannies expect a guaranteed base pay every week, even if the family doesn't need her one or more days. This is not a requirement, however it is so common that if you do not plan to do this you should disclose in the interview and the work agreement so you don't end up with a very unhappy nanny somewhere down the road and have to replace with little/no notice. This is much less common for PT nannies. Make sure you state her pay in hourly rate terms, and if more than 40 hours are needed in a week do the math for regular and overtime rates. The Hourly Rate Calculator at 4nannytaxes.com will do the algebra for you!
3. Does anyone have a sample list of terms or a contract that you wrote with your nanny that you might be willing to share?
There are sample work agreements here: http://www.4nannytaxes.com/index.cfm/resources/forms/
Also state specific payroll and tax tip sheets can be downloaded from here: http://www.4nannytaxes.com/index.cfm/resources/news-and-updates/household-employment-rules-by-state/
4. Is there a good website that describes the responsibilities of the employer of a nanny, such as with respect to tax withholding?
Our FAQ has been developed from 20+ years of experience helping new household employers with their questions: http://www.4nannytaxes.com/index.cfm/faq/nannyhousekeeper-faq-list/
I hope that helps!
Kathy Webb
Nannies are employees, not independent contractors. They get a W-2 form, and you at a minimum need to pay Social Security and Medicare taxes.
You can pay NET of employment taxes if you want, we don't recommend NET of all taxes.
http://www.4nannytaxes.com/index.cfm/resources/news-and-updates/nanny-employee-or-contractor/
You can pay NET of employment taxes if you want, we don't recommend NET of all taxes.
http://www.4nannytaxes.com/index.cfm/resources/news-and-updates/nanny-employee-or-contractor/
Anonymous wrote:Anonymous wrote:Anonymous wrote:I'm one of the PP's-
I am working towards becoming a Certified Newborn Care Specialist. I know this isn't official, but every Baby Nurse I have talked to (and this has been several) does their taxes an Independent Contractor.
The way it was explained to me is because they choose their clients, set their own hours, work short periods of time, work for several different clients over the year, etc.
Some specialized nannies meet the same criteria.
Can Kathy Webb weigh in on this?
There is no simple answer here - as someone else posted it is a gray area. A compelling argument could be made that they are Independent Contractors, and an equally compelling argument that they are employees. Treating the newborn care specialist as an employee is the safe, conservative route. In DC this is very common because of the political, reputational, and security clearance risks.
If you are going to engage the NCS as an independent contractor, you MUST also remember at the end of the year to issue a 1099. If you fail to do that, all bets are off because this simply looks like you are paying under the table. To the quoted poster's reasons that IC is okay I would add they set their own rates, and they maintain business formalities (they have a website, business cards they present you with a contract, etc.).
Get it in writing between the two of you - family and NCS - and make sure you get a full legal name, address and SSN for the tax reporting.
As to 'specialized nannies' I don't know what the poster is referring to here. By the standard definition of a nanny - whether full time, part time, or temporary/summer only - they are employees.
OP I suspect this is now overcome by events - namely April 15!
However for you and the other posters, this is a link to a good discussion of the two scenarios - what you thought you were agreeing to and what the nanny thought you were agreeing to...
http://www.4nannytaxes.com/index.cfm/faq/nannyhousekeeper-faq-list/nanny-net-wage-agreement/
And I agree with the earlier posters that this is a common new employer mistake - don't beat yourself up over it! What is important is that going forward you and your nanny are absolutely clear about who is doing what to whom regarding the taxes, and make sure your work agreement states the GROSS hourly wage.
However for you and the other posters, this is a link to a good discussion of the two scenarios - what you thought you were agreeing to and what the nanny thought you were agreeing to...
http://www.4nannytaxes.com/index.cfm/faq/nannyhousekeeper-faq-list/nanny-net-wage-agreement/
And I agree with the earlier posters that this is a common new employer mistake - don't beat yourself up over it! What is important is that going forward you and your nanny are absolutely clear about who is doing what to whom regarding the taxes, and make sure your work agreement states the GROSS hourly wage.
Anonymous wrote:Anonymous wrote:The minimum quarterly amount for requiring taxes is very low (1800-2K total over a quarter) so you'll need to do taxes.
1. DO NOT agree to pay your nannies taxes for her. If she pretends she has never heard of taxes move on.
2. You are required to be pay 50% (employer share) of SSN/Med and withhold the other 50% from her gross pay. You file both amounts. If you fail to withhold her portion, you are legally responsible.
3. As an individual employer, you are not required to withhold her income fed or state. You can offer to do this if you are comfortable with doing taxes but if not, don't do this.
4. When you hire a nanny you quote GROSS pay not NET pay. You can point the nanny to a tax calculator so she can understand what her net pay would be but you don't control the tax code so you can't guarantee net.
5. Health insurance is a benefit not a requirement. Not all nannies want or need this. For some its a great perk and others just want the money. You should never agree to provide insurance as picking a policy and the cost is dependent on her personal health needs and conditions. You can offer a contribution toward her health care plan (that she is responsible for picking). You should offer a set amount (100-200 a month) not offer to pay for he plan because you have no idea what this will be. You also need to either write the check directly to the insurance company or get receipts from her for this to be tax deductible. If you just give her the money, its taxable income.
6. Check your home or renter's insurance, this should be fine. You would acquire workers compensation insurance which covers any accident she has while working for you. The renter's or home is more for damage to the property she could cause which is less likely. If she is driving, you need to look into an insurance rider for this.
Who can we thank? Kathy?
Sorry, I don't get credit here
. Most of the advice is good, however the Federal employment tax obligation kicks in if you pay $1800 in the calendar YEAR, state unemployment obligations kick in if you pay $1000 in a calendar quarter in MD or VA, and $500 in a calendar quarter in DC.
OP we have a free Household Employer's Quick Start Guide you are welcome to download! http://www.info.4nannytaxes.com/nanny-payroll-quick-start-guide
OP there are other issues involved here. We publish a free tip sheet on best practices and considerations when letting a nanny go:
http://www.info.4nannytaxes.com/how-to-fire-a-nanny
http://www.info.4nannytaxes.com/how-to-fire-a-nanny
OP you do not report any MD employment on your personal MD state income tax return. The taxes you paid to MD were either a) unemployment taxes or b) taxes you deducted (collected) from your nanny/employee's pay check and then remitted to MD for her. Neither of these items have anything to do with your MD personal income tax return.
Hope that helps!
Hope that helps!
Anonymous wrote:Anonymous wrote:This post isn't about who benifits most because in a live-in situation (it's the employers of course), or about freedom to choose to leave a job if you don't like it. It's about the overtime laws applied to live-in's. They are incredibly unfair to workers. Stating no pay for 8 hours, even though some nannies are technically working, and then no OT after 40 hrs. Why???
Anyone? Kathy and Susan?
What exactly is the INA lobby doing?
The INA doesn't have a lobby, and to my personal knowledge never has. Lobbyists charge $$$, and lots of it. And I will restate - the laws you take exception to were written 11 years before the INA even existed - I cannot follow your logic that somehow makes the INA responsible for them?
The INA does, however, take the time to respectfully inform nannies of their rights under law: http://nanny.org/nannyrights
Anonymous wrote:Many of our employers and nanny agencies have professional lobbyists advocating for these loopholes in the law. No one is advocating for nanny rights or protection. No one that I am aware of. Someone please correct me, with all details, if I am wrong.
This is one of the many problems with the ina, International NANNY Association. Their attorneys and lobbyists are advocating for laws that financially benefit nanny agencies and their clients, not for the nannies.
Poster, can you please point to one attorney or lobbyist that is advocating for laws that financially benefit nanny agencies and their clients? And precisely how the INA, founded in 1985, had anything to do with the Fair Labor Standards Act as amended in 1974.
I realize you have an axe to grind, and an anonymous message board is very attractive, but at least work from facts.
And OP, FYI Maryland requires OT for live in or live out over 40 hours. Several states, not just NY, have overtime protections of at least some live in domestic workers.
The Department of Labor, under the Obama administration, has made some proposed rules changes for domestic service workers minimum wage and overtime coverages under the FLSA that have been sitting in limbo since December 2011. And these Administration proposals do not propose doing away with this. That would be a good place to start if you want to influence this rule.
Anonymous wrote:Kathy,
We appreciate your interest. The INA problems being raised on this board are not about educational opportunities. No one disagrees with the benefits of continuing education for all.
The issue is that the INA is supposed to be a nanny organization, not a self-promoting agency marketing scam.
Actually, I believe the quoted poster is confused about what INA is, and always has been.
http://nanny.org/mission
"INA's mission is to serve as the umbrella association for the in-home child care industry by providing information, education and guidance to the public and to industry professionals."
Anonymous wrote:
The INA is supposed to be the International Nanny Association. If you are not a nanny, why are you sitting on the board of this group? Why are you even a member?
www.nanny.org
Again, this shows confusion about the mission of INA - it is an umbrella organization that welcomes all aspects of the nanny industry - nannies, agencies, educators, special service providers, and even families who employ nannies.
From the Mission Statement linked above:
"The International Nanny Association (INA), a nonprofit organization, serves as the umbrella organization for the in-home child care industry. INA members include nannies, nanny employers, nanny agencies, educators and industry service providers. Since 1985, INA has worked to professionalize the industry by setting high standards for industry professionals and nanny agencies. INA leverages the expertise of industry professionals from around the globe to help increase awareness about the industry, to develop the professional skills of nannies, and to educate parents about the benefits of hiring a qualified nanny to care for their children."
Perhaps you are confusing INA with the former NAN (National Association of Nannies)? INA has never been a nanny only organization, and it was organized originally by nanny educators and a small handful of placement agencies to try to establish and articulate norms and standards for the industry, and provide educational opportunities for all parties active in the in-home childcare industry. I was welcomed warmly in 1993, and nannies and agencies alike understood the benefits of professional compensation, which included the proper payroll treatment of the nannies/employees.
Anonymous wrote:
How many nannies are on the board of your nanny agency organization?
www.theapna.org
Zero. Why?
You don't even allow nanny or family membership, let alone be on the board. Why?
Please explain your "no nannies or families allowed" policy, in your own association, but demand to control the "nanny" organization?
Why no equal "balance"?
1. Non-nannies should step down from the INA board. Until you do, there is no hope for any real advocacy for nannies and the families they care for. The priority of agency business owners, is their profits. This is a distinct conflict of interest with nannies and families, who strive to provide the best possible childcare. Few, if any, agency owners have any significant training or extensive experience in childhood development, beyond their own families. Many agency owners are smart business people who recognized a lucrative business opportunity. Some are even attorneys and MBA's who capitalized on the naive nature of nannies and parents in disparate need of childcare.
2. Your own exclusive nanny agency club, should open its membership to nannies and families. If you want to maintain your membership and voting privileges in the International Nanny Association, you should extend the same options for nannies and families in APNA.
Also, it would be worthwhile for you to disclose the current breakdown of the INA membership. What are the current numbers for:
1. Nanny Agencies and other businesses
2. Actual Nannies
INA was started originally started by a group of nannies before it got over run by agency business owners, from what I understand. Let it return to being, what its name says:
The International Nanny Association
This is factually wrong. INA was never established by nannies and then over run by agencies. Again, I suggest you might be confusing INA with NAN, which was by nannies, for nannies, and folded in large part because there were not enough nannies willing to step up and volunteer and lead, something every association needs to stay viable.
I am very proud to work side by side on the INA board with nannies, agencies, and newborn care specialists. We respect each other, work together very cooperatively, hear each other's different points of view, and put forth a lot of effort to improve the professionalism of the entire industry.
I am a member of the INA Board of Directors and have been an INA member for 20 years. For the record, the Board of directors includes:
4 Agency owners - 3 US and 1 Australian
4 Nannies
1 New Born Care Specialist
1 Payroll Services Company owner (me)
I would suggest that this does show balance?
2013 Conference was fabulous, and the strongest educational tracks were the nanny track and the New Born Care tracks.
Speakers included:
Deborah Gilboa, MD http://askdoctorg.com/
Carolyn Stulberg http://alexandria-school.com/about_us
Vicke Bowman http://www.linkedin.com/pub/vicke-bowman/5b/936/a83
Gina Deveary Co-Founder of the Louisville, Ky, Sensory Processing Disorder (SPD) Parent Support Group
Carly Jennings mommygarten.com
Mary Beth Uberti (her presentation on teens and social media was amazing and eye opening!)
I cannot tell if the prior posts are by a few people or not, and I am not being anonymous here. I am deeply saddened that nannies, and possible families, do not see the value in the professional enrichment and development of the nannies caring for these young children. As the mother of 3 (albeit grown) children and grandmother of 2, I am passionate about providing nannies educational resources to improve the quality of care they can deliver to our children - and I put my time and money where my mouth is.
And for those looking for local educational opportunities - National Nanny Training Day is this coming Saturday and there are local DC events, as well as approximately 40 other cities nationwide.
4 Agency owners - 3 US and 1 Australian
4 Nannies
1 New Born Care Specialist
1 Payroll Services Company owner (me)
I would suggest that this does show balance?
2013 Conference was fabulous, and the strongest educational tracks were the nanny track and the New Born Care tracks.
Speakers included:
Deborah Gilboa, MD http://askdoctorg.com/
Carolyn Stulberg http://alexandria-school.com/about_us
Vicke Bowman http://www.linkedin.com/pub/vicke-bowman/5b/936/a83
Gina Deveary Co-Founder of the Louisville, Ky, Sensory Processing Disorder (SPD) Parent Support Group
Carly Jennings mommygarten.com
Mary Beth Uberti (her presentation on teens and social media was amazing and eye opening!)
I cannot tell if the prior posts are by a few people or not, and I am not being anonymous here. I am deeply saddened that nannies, and possible families, do not see the value in the professional enrichment and development of the nannies caring for these young children. As the mother of 3 (albeit grown) children and grandmother of 2, I am passionate about providing nannies educational resources to improve the quality of care they can deliver to our children - and I put my time and money where my mouth is.
And for those looking for local educational opportunities - National Nanny Training Day is this coming Saturday and there are local DC events, as well as approximately 40 other cities nationwide.
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