Parents appoint a nanny for their children to take care of their children. When they appoint or hire a nanny they become employers, then need to set up a payroll taxes like other large corporations. There are few instructions to set up a nanny payroll process for nanny tax compliance, such as:
- Parents need to state the compensation details in writing, and it is important to record the details of the financial agreement to protect a nanny and employer or parents. You need to mention whether you will be paying the compensation on weekly basis, days basis or hourly basis.
- If there are any payroll deductions, they it should be mentioned. You need to pay Social Security and Medicare taxes from nanny's payroll. You can also deduct it from your employee.
- Employer needs to maintain accurate and complete existing time tracking record for all hours in which employee worked.
- Employer should get completed forms W-4 and I-9 from an employee. You need to keep these forms with your permanent employment records because they are legally required.
- The form W-4 which includes legal name of nanny, address and Social Security Number, so nannies particulars are provided by this form to you for tax filing.
- You need to have a Federal Employer Identification Number from the IRS immediately which is required for all Federal tax reporting.
- If nanny's state income taxes are being deducted by you then research and apply for a sate unemployment tax account and state withholding tax account.
- Follow the instructions of the Federally mandated state new hire reporting. New hire registration programs are managed and implemented by the Federal legislation to track individual employment data for the purpose of quick child support enforcement and fraud control of different welfare programs.
- You should be aware of tax reporting schedules and requirements.
These are the instructions, which may help you to set up the payroll process for nanny tax compliance.
Related Links:
South Florida nannies
No comments:
Post a Comment