Go to the IRS website. It is VERY CLEAR. ALL DOMESTIC HELP are EMPLOYEES. You must do payroll withholding. The penalities are...the employer pays all the back taxes and fines.
Please, go read up on it. Do not get people into trouble by telling them it is ok to do a 1099. IRS says..no, they are not contractors (1099) they are employees (w2)
You need to check with a CPA. If an employee then person hiring you (unless an agency employee) has to make deductions and file and pay IRA and SS what is due quarterly. If you are considered self-employed, then you have to pay IRA and SS. If paid under the table, you will not get credit for SS and person you r caring for can't make deductions pertaing to their care.
Katiekate, that's simply not true. Domestic help doesn't mean employee. Like other's have said, they can be 1099 AKA independent contractors for example. In that case, they are explicitly not employees.
If you pay yourself a "salary" from your mother, then yes. You would need to declare it and she can claim it on her taxes, if she files any.
If you take a few bucks to put in your gas tank to take her to a doctor's appointment or if you do her grocery shopping and you put a few items of yours in with her order, then no.
If you are asking whether you paying yourself from your parent's funds to provide 24/7 care to provide documentation for later Medicaid needs - YES. You have to pay the taxes due on the income. If you are paying yourself as independent contractor you will need to file a 1099-MISC that lists your parent as the person paying and yourself/family member as the person paid. Please be aware that power of attorney doesn't usually let you pay yourself without parent consent and most dementia patients can't give informed consent.
I assume that this person does not work for a company, but are independent? If that is the case, then I believe that you give them a 1099 Miscellaneous and they are responsible for paying their taxes.
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You are wrong!
Go to the IRS website. It is VERY CLEAR. ALL DOMESTIC HELP are EMPLOYEES. You must do payroll withholding. The penalities are...the employer pays all the back taxes and fines.
Please, go read up on it. Do not get people into trouble by telling them it is ok to do a 1099. IRS says..no, they are not contractors (1099) they are employees (w2)
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If you pay yourself a "salary" from your mother, then yes. You would need to declare it and she can claim it on her taxes, if she files any.
If you take a few bucks to put in your gas tank to take her to a doctor's appointment or if you do her grocery shopping and you put a few items of yours in with her order, then no.
All domestic help is considered employees. ALL. Thus, payroll taxes must be paid...also, social security withholding and Medicare payment.