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 Return to Eldercare FAQ List
My home health aide (housekeeper) is not a legal resident. What should I do about employment taxes?
The Internal Revenue Code maintains that the immigration status of your household employee has no bearing on your obligation for employment taxes. The IRS requires that workers ineligible for Social Security Numbers file form W-7 to request an Individual Taxpayer Identification Number (ITIN). This number will be used on all tax reports and returns, including Form W-2. The IRS is currently prohibited from sharing this information with Immigration and Customs Enforcement (formerly Immigration and Naturalization Service [INS]) by law - see THE PRIVACY ACT OF 1974 5 U.S.C. ยง 552a.
What the ITIN Does
- Enables employers to report wages paid to the domestic employee without fear that the tax returns will be rejected due to missing or inaccurate SSNs.
- Enables employers to issue Form W-2 to workers ineligible for a SSN.
- Enables individuals ineligible for a SSN to file US Income Tax returns.
What the ITIN Does NOT Do
- Confer eligibility for employment.
- Confer legal immigrant status.
- Make the worker eligible for Social Security or Medicare benefits.
- Confer eligibility for the Earned Income Tax Credit.
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Non-payment of taxes is a reason for an alien's immigration petition to be declined. Immigration and Customs Enforcement (ICE) can consider the failure to file an income tax return, if a person earned enough to be required to file, as proof that the noncitizen doesn't have the "good moral character" required of applicants for US citizenship. Failure to file income tax returns or an improperly prepared tax return can cause problems when the permanent resident files for US citizenship or when a US citizen or permanent resident tries to help family members immigrate.
Illegal Immigrant Domestic Workers in the News
The issue of illegal immigration and a citizenship path or amnesty for undocumented foreign workers in the United States is a major political issue at this time. There are proposals before Congress to reform our immigration policy, and perhaps our border security, that will have dramatic consequences to the many employers, including families, who currently employ undocumented workers.
Many households employ illegal immigrants as nannies, housekeepers, groundskeepers, etc. Some of these households already comply with employment tax reporting; the majority do not. All of the various proposals being discussed in Washington include either a Guest Worker program, an amnesty program with a citizenship path for illegal immigrants already working in the U.S., or both. What does this mean to the household employer?
It is expected that all applications for immigrant legalization will include a detailed examination of the immigrant's background, including their employment history while in the U.S. Immigrants applying for a Green Card or other legalized status will be required to document tax compliance. All plans include an examination of tax return records going back a minimum of 3 years. The illegal immigrants will be highly incented by the promise of legal status, and it is expected there will be significant pressures on current employers who have been paying these immigrants 'under the table' to come clean and catch up on tax payments so the immigrant can take advantage of the legalization program.
HomeWork Solutions' staff can assist employers in this compliance, including the preparation of back tax returns.
Register Now
'Green Card' Applications - Foreign Domestic Workers
Important April 2005 Update.
For More Information contact HomeWork Solutions, Inc.
at 1-800-NaniTax or e-mail and submit a question.
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