Nanny Tax Threshold Unchanged in 2010
Families who pay a nanny or other household employee $1700 or more in either 2009 or 2010 are liable for the "nanny taxes." Depending on your state, if you pay between $500 - $1000 in wages in a calendar quarter you are also liable for state unemployment tax filings.
The "nanny tax" refers to Social Security and Medicare taxes due on the wages paid to a household employee. These total 15.3% of the nanny's gross or cash wage. Unemployment taxes, both state and federal, will add another 3 - 4% to this total. The household employer is entitled to collect 7.65% of the Social Security and Medicare taxes from the employee's payroll; however, failing to do that will make the employer liable for the entire tax amount.
Nannies and all household employees are due a W-2 Wage and Tax Statement no later than January 31 following the close of the tax year.
The "nanny tax" refers to Social Security and Medicare taxes due on the wages paid to a household employee. These total 15.3% of the nanny's gross or cash wage. Unemployment taxes, both state and federal, will add another 3 - 4% to this total. The household employer is entitled to collect 7.65% of the Social Security and Medicare taxes from the employee's payroll; however, failing to do that will make the employer liable for the entire tax amount.
Nannies and all household employees are due a W-2 Wage and Tax Statement no later than January 31 following the close of the tax year.
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Want to learn more about the "nanny tax" and the employer's legal and financial obligations? Download HomeWork Solutions' free e-Book, the Nanny Payroll Tax Quick Start Guide. |
posted by Kathleen Webb at
8:18 AM
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