Are your clients with household employees draining your professional resources?
As a CPA, you may take on the burden of nanny tax and payroll management without realizing how much work you're agreeing to provide. It can be that Friday afternoon call to calculate withholding taxes on a check that includes overtime. Or the questions about how to fill out a W-2 or I-9 form. Unfortunately, this may ultimately be more than time-consuming – it could also be eating away at your profits.
The ‘Black Hole’ of Nanny Taxes
Agreeing to handle nanny taxes might seem like a great way to satisfy your clients, but if you're not careful, the black hole of nanny tax could consume your entire operation.
On the surface, nanny tax and payroll management might seem like a simple process. However, once you start chipping away at the details, there are many processes that you might not have the time, the resources, or the background to handle alone. Many accountants who take on the burden of nanny taxes find that they regret their decision almost instantly.
Educating Yourself in the Area
As a CPA, you're an expert in accounting, but that doesn't mean you’re fully versed in everything that falls under the broad financial umbrella. The world of accounting is far too vast for any accountant to specialize in every field. Nanny tax and associated labor law is an incredibly complicated area, and handling compliance will force you to deal with a range of issues, from responding to the IRS to filling out schedule H forms and calculating gross pay.
You could also find yourself advising clients on areas beyond your specialty, such as state insurance requirements, work authorization, and more. That means you’ll always be researching the area to try to stay informed, which will involve spending more hours working than you’ll be paid for.
Constant Change
Not only are there piles of paperwork to complete and regular research to conduct, but nanny tax is fraught with traps and hurdles. These only become obvious once you're already in the middle of an account.
From multiple residencies to traveling employees, there can be countless layers within an already problematic process. You will need to keep on top of the many changes in this area to be able to complete nanny payroll correctly – and that’s in addition to the work in your specialist areas.
Time is Money
The complicated, multi-faceted nuances of nanny tax and payroll management mean that you could easily end up spending so much time researching, learning, and adapting your processes that you simply can't turn a profit. In fact, you could even end up losing money.
The process can become even more difficult if your client dumps a huge amount of last-minute work on you as Tax Day approaches, leaving no time for preparation. Thanks to the ever-changing nature of nanny tax regulations, the overtime you’d need to work to find out new information would make it almost impossible to meet deadlines – which could cost you your client.
The Solution: Outsourcing Nanny Payroll
Fortunately for frustrated accountants, there is a solution.
You don't have to choose between disappointing your clients by rejecting their requests for nanny tax and payroll management, providing a sub-par service, and putting your business at risk. Instead, you can simply outsource the tasks for household employment to someone with specialist expertise.
HomeWork Solutions focuses exclusively on nanny taxes and has more than 20 years of experience in household employee payroll and tax management. That's why we can manage the various complexities of this intricate financial area without sacrificing accuracy or attention.
Leave Household Employment to the Experts
While it can be tempting to try and appeal to more clients by offering nanny tax solutions, the truth is that you should avoid offering such services until you know how you can take care of them.
Outsourcing is the ultimate way to keep your clients happy and your profits healthy.
Contact HomeWork Solutions today and speak to our knowledgeable staff about working together to simplify your homeworker accounting services.