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Reply to "Still so confused over taxes- help!"
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[quote=Anonymous]We've had a nanny for a few years. In addition to her salary and health insurance, we pay both her portion and our portion of taxes. In other words, in addition to her salary, every quarter we pay a few thousand dollars more to cover her taxes (we do this all through a nanny tax service). My question is, what is the most common practice? I know a few families who say that they just cover what is required (FICA) and then at the end of the year, their nanny needs to pay taxes out of what she has made. To me, this seems totally unfair to the employee but it seems common. Does anyone else do this? We pay our nanny about $18.50/hour before taxes but when you factor in her taxes, we end up paying close to $60k a year, which seems like a lot. We are about to make a change (nanny is moving away) so I want to understand what is most common as we negotiate with someone new. Thanks.[/quote]
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