Nanny wants to be paid W2?

Question

Our family hired a part-time nanny. Only 9 hours a week for about the past half year. She now tells us she needs a W2 form. We are not a business and do not know how to go about paying here thru W2. Does anyone know how to pay her W2?

Answer 1

I agree with first answer. Does she want you to start withholding federal and state taxes, FICA/social security? She won't have much leftover. Will she even make the minimum to have tax liability in 2006? ($4500 or something like that I think)

Answer 2

This is a little late to start talking about this, but to stay within the law you should have been withholding FICA all along and paying a matching amount yourself, and withholding income taxes if her income is high enough to require that - it might not be, but you still need to withhold the FICA and send it to the IRS.

Consult a CPA (NOT H & R Block) regarding what you need to do. The people suggesting just continuing to pay her cash are suggesting that you both break the law. OK, it's commonly done, but not a good idea. And she very likely doesn't meet the requirements to be paid on a 1099.

Answer 3

I agree with the first poster. First off in order for you to give her a W-2 you would've had to already taken taxes out of her check since day one. Since you haven't been taking out taxes she don't get a W-2. Now, usually nanny's report their income at the end of the year on their taxes in which at that time she will have to pay her taxes owed on what she earned. Also, you should be reporting your payments to the nanny on your income taxes as that is an additional expense. In order to properly pay her with a W-2 will cost you. As the second poster stated you will need to file for your tax ID # and federal #. You will need an accountant to set it all up which just might make that nanny no longer affordable. Personally, I would start looking for another nanny, one with less demands. She is your private contracted nanny in which is responsible in reporting her own income to the IRS. If you would like to research further you could always go to your state website or irs.gov and look into the labor laws. Good Luck & God Bless!

Answer 4

She is correct. If she is working in your home, generally, the IRS is going to consider her your employee.

You must get a Federal ID Number, withhold taxes, issue a W-2, pay unemployment taxes and all that fun stuff.

You will also need to file a Schedule H with your 1040 this year. If you don't have one, now would be the time to hire a professional to do your taxes. Obviously, hire one that has experience with household employees

http://www.irs.gov/businesses/small/article/0,,id=97877,00.html

Answer 5

If you paid her more than $600 for the entire year, you can issue her a 1099. You don't need to be a business to do this. A tax professional can help you with this. But if she made less than $600 no one is required by law to report it.

Answer 6

If you're paying her cash or personal check, then you can give her a "1099" form. If you're paying her with a paystub (tax deductions, social security, etc), then you must give her a "W2" form. But what would she want to report what she's making to the IRS? I mean, how much are you going to pay her? I don't think a nanny can make that much money. I just don't see the reason why would she want to report this.

Answer 7

You don't have to do that....especially if she did not disclose this to you up front. You are not taking tax out on her are you? If you have records of how much you paid her, like check stubs, you can be nice and give her a total of hours and wages. It just sounds like she's a bit confused.

Answer 8

Talk to someone with H&R Block. They give free tax advice.