If you’re thinking about hiring a senior caregiver this year, it’s crucial to do your research and be sure you know how to go about it – especially when it comes to payroll. There is a lot of misinformation online that can be confusing for families. Here, we’ll break down myths versus facts so you know exactly how to pay your caregiver fairly while withholding proper taxes.

Child care can be extremely costly. One of the best ways to provide personalized small group care and save money on child care without cutting corners is start up a nanny-share with another family.

You’ve hired a live-in nanny and you’re excited to have her join your family. Now it is time to address the details - outlining some important parts of what the living arrangements will look like. Here are some helpful tips for you to consider when it comes to considering the impacts of another adult in the house and how you should go about setting boundaries.

If you’ve recently hired a senior caregiver, it is extremely important that you understand how to properly manage payroll, as there is a lot of misinformation out there that can be confusing. If you can understand what the biggest problems with senior caregiver payroll are, then you will be able to get started on the right foot at the very beginning of the employment relationship.

If you employ one or more domestic workers (nanny, senior care aid, housekeeper, etc.), you have special responsibilities mandated by the New York Department of Labor.

Compensation

• Minimum Wage: You must pay your worker at least the minimum wage. If you provide meals or housing to your employee, you may be eligible for a credit toward the minimum wage paid to the worker (for more information, visit the NY Dept. of Labor website).
• Overtime: An employee is entitled to overtime at 1.5 times the employee’s basic hourly rate after 40 hours of work in a calendar week. If the Employee lives in your home, overtime is engaged after 44 hours in a workweek.
• Paid Time Off: After one year of employment, employees are entitled to three paid days off.

Time Off

• Weekly: One day of rest must be provided per week. Employers are encouraged to set this day to coincide with the employers day of worship, if they observe one.
• Yearly: After one year of employment, employees are entitled to three paid days off per year.

Written Work Agreement

• Contract: To be enforceable, a work contract must offer notice on policies regarding sick leave, vacation, personal leave, holidays, and hourly reporting.
• Sample Contract and Free Guide to Writing Your Own Nanny Contract

Insurance

• Unemployment Insurance: Unemployment insurance is required for any employee you pay over $500 per calendar quarter.
• Worker’s Compensation Insurance: This insurance is required for any employee that works at least forty hours per week, and covers them (and you) if they are injured on the job.
• Statutory Disability Insurance: This insurance covers an employee who cannot work because they are injured or sick (this includes pregnancy) as a result of something that does not occur in the course of their work. This policy pays benefits for up to twenty-six weeks. The employer can charge the employee up to $0.60 per week to cover the cost of the policy.
• Health Insurance: You are not required to provide health insurance to your employee.

Payroll Taxes

• State and Federal Payroll Taxes: The employer is responsible for unemployment tax and the employer’s portion of the FICA taxes. The employer is entitled to withhold the employee's portion of the FICA taxes from the nanny's wages; however, if the employer does not withhold the EMPLOYER remains responsible to pay this tax to the IRS.
• State and Federal Income Taxes: Income taxes are the nanny's responsibility. The nanny may ask and the employer may agree to withhold  federal, state, and local income taxes from the worker’s paycheck. The domestic employer is not required to withhold income taxes, it is an accommodation to the worker.
• Reporting: The worker and the employer must file certain forms to comply with tax requirements. To learn more about your tax responsibilities, call HomeWork Solutions at 1-800-626-4829 for a free consultation or visit us here for to learn about our payroll and tax compliance services.

For more information on the NY State Domestic Bill of Rights, visit their website.

Related Resource:

411: Household Payroll in New York

Webinar Recording: HWS and Park Slope Parents Employing a Nanny in New York

At HWS, we are taking a departure from our normal weekly post to share with you a post written by a mom we have never met, about a nanny we don't know. On a daily basis we speak to Moms and Dads across America who freely express their appreciation for their nanny. They understand the key role the nanny plays in their lives and the lives of their children. They "get it."

Nursing homes and assisted living centers aren’t for every senior. Many seniors want to age in the comfort of their own home, but after time goes by, it’s clear that in order to do this, in-home help is necessary. When your loved one enters into the elderly stage of life, sometimes things that were once simple like getting dressed, moving around, cooking, and cleaning become very difficult. But, opening up the home and entrusting your loved one to a caregiver is a big step and one that should be undertaken with caution and research.

Here are some important must-knows about hiring a senior caregiver.

Nanny sharing is a common situation that allows one nanny to care for the children in multiple families. The families will literally share the nanny and it can be a good option for families on a budget. It’s also a good way for your kids to socialize with other kids in a home setting that is safe and familiar. While there are a lot of proven benefits to nanny sharing, there are also some problems that can happen. Here are some of the most common issues you’ll run into with a nanny share situation and some tips on how to solve them.

We often hear of impaired seniors “wandering off” but the stereotype can be far too general, and often linked to a disease like Alzheimer’s after it has been diagnosed. However, there are warning signs of this disease or dementia that you should be aware of so you can help keep your loved one safe without limiting their independence. Here, we provide helpful tips on caring for an aging loved one who is showing signs of being confused, forgetful, or disoriented.

For many working parents, finding a hired caregiver/nanny that they trust to be with their children during the workday is extremely important. It may be convenient to pay your nanny under the table, but not only is this illegal, but it can be incredibly costly if you get caught. If you do not pay nanny taxes, there are heft fines and penalties, sometimes ranging upwards of $25,000.

Many families find this both complicated and time consuming. Prefering to dedicate this time to their family, they outsource the nanny payroll to a specialty nanny payroll service like HomeWork Solutions.  

If you’re determined to figure out how to pay the nanny taxes yourself, here are the steps on how to pay your nanny legally.