I hired a private caregiver to stay with my father but had to terminate her for lying about the hours she was working. She was hired on the premise that she was self employed. Not only was she a caregiver to my father, she also cleaned houses. Now she has filed unemployment, claiming she made way less than what she was paid and also that my father was her sole employer. Now I'm looking at paying fines, amending two years of taxes for my dad, and paying the employer portion of unemployment. The unemployment office has already sent a field agent out to investigate and I'm worried sick. I have text messages from her stating she was cleaning houses certain days for a regular client of hers. Will this be enough to prove to the ubemplymebt office that she was self employed?

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I have worked as a contractor most of my career. (Not in healthcare.) Some years I was an independent, paying my own employment taxes, getting a 1099 form from the company, and estimating my taxes quarterly. Many years I worked through an agency and I was treated as an employee of the agency, not of the company I did work for.

So I understand the difference between a private contractor and an employee. But I also understand that most people aren't at all familiar with this concept, and I sympathize when they get caught up in a crisis over it.

Many of us have paid baby sitters occasionaly over the years and not had a thought about taxes. We have someone come in to trim some trees or refinish our wood floors and we pay them. End of story. So it isn't surprising that we think we can hire someone to help out a few hours around the house and just pay them, end of story.

Not surprising, but often illegal, and we can wind up in trouble. I am sorry for you. You were trying to do your best, and probably not "trying to preserve inheritance." My guess is you were just ignorant of the employment laws.

Do get yourself/your father a lawyer.
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You will be paying unemployment unless you have a written contract, declared the wages, paid the withholding, and can prove she lied to you.
Best you get a lawyer, now.
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Usually caregivers who are independent contractors are required to pay their own quarterly estimated IRS taxes from their pay.   Usually they cannot file for unemployment.

By chance did you have a written contract with the caregiver, staying what were her duties, her pay, what days she worked, and who was responsible for her payroll taxes [in case you used a payroll company]?

Sorry you have to go through this.   It's ashamed that some people try to milk the system and the aging parents or adult child gets stuck in the web.

For my Dad, I hired a caregiver from a professional Agency... the Agency  was licensed, bonded, insured, and had workman's comp for their employees.  Yes, it was expensive, but worth every penny in the long run.

If you hire another caregiver outside of an Agency, your Dad would need to add a "workman's comp" rider to his homeowner's insurance in case the caregiver gets hurt on the job.   And make sure the caregiver can prove he/she had a recent flu shot and an annual TB test.
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Nope. I hope many see your post. People want to avoid employment laws by hiring contract caregivers. In most cases this will not fly. There are too many caregivers being taken advantage of by families that are trying to preserve inheritance. There is plenty of information on the IRS website about when a caregiver is a contractor vs employee. Most times it is an employee. Just be honest and get it fixed.
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