Babysitting is an essential service for parents who want to go on a date, attend a child-free event, or simply have some time to recharge. However, when tax season arrives, many caregivers wonder whether they need to pay taxes on those earnings. The answer depends on how much money changed hands and whether the temporary work meets the guidelines for self-employment.
Topics: household employee taxes, nanny, agency, nanny side jobs, babysitting taxes, babysitter self-employment tax
If you’ve hired a nanny, you’re responsible for handling their payroll and taxes correctly—and that includes issuing a W-2 at the end of the year. But a W-2 isn’t just a form you fill out in January; it’s the final step in a yearlong process of paying your nanny legally.
Topics: nanny w-2 form, nanny, agency, nanny tax withholding, How to create a W-2 for a nanny, Employer responsibilities for a nanny, Nanny tax forms
Surprisingly (or maybe not…), the Internal Revenue Code doesn’t provide a neat little list of exactly what can and can’t be deducted as a business expense. Instead, it gives us this broad guideline:
Topics: nanny taxes, household payroll, agency, CPA, business expense deductions, household employee tax rules, self-employed tax write-offs
Hiring the right professional nanny for your child is one of the most important decisions you’ll make as a parent. You want someone who is not only experienced and trustworthy but also a perfect fit for your family’s unique needs. The search process, however, can be overwhelming and time-consuming—especially when it comes to ensuring that every candidate is properly vetted and qualified.
Topics: nanny agency, hiring a nanny, Hire a nanny, Professional nanny agency
Feeling like there’s never enough time in the day? You’re not alone. Between work, family, and everything else on your plate, managing your household’s payroll and taxes can feel overwhelming. But here’s the good news: you don’t have to do it all yourself.
Topics: household employee taxes, caregiver payroll, nanny, nanny payroll, nanny background screening, agency, senior, outsource household payroll, stress-free payroll solutions
You’ve hired a fantastic nanny, housekeeper, or caregiver — but now it’s time to navigate pay stubs. It’s more than just a piece of paper. A pay stub is your proof of legal compliance, your employee’s proof of income, and one of the most important parts of managing household payroll.
Topics: nanny agency, nanny, homework solutions, Pay stubs for household employers, How to create pay a stub for nanny, pay stubs for caregivers, pay for household employees
Many families who hire household employees, like nannies, senior caregivers, or housekeepers, may not realize they’ve become employers in the eyes of the IRS and labor authorities. It’s common for families to agree to pay "off the books" without thinking about taxes — until January rolls around and the employee asks for a W-2.
Topics: nanny agency, nanny, household payroll, senior, CPA, W-2 for household employee, W-2 nanny, W-2 caregiver
Each year, the IRS releases an updated W-4 form, and while it's not mandatory for employees to fill out a new one annually, it’s a smart move to review it. Adjusting withholding helps employees avoid surprises like a big tax bill or an oversized refund at tax time.
Topics: nanny agency, nanny, senior, 2025 W-4 form, W-4 for nannies, tax withholding for employees, nanny tax withholding
Updated December 2024
Every year HomeWork Solutions prepares a summary of new or updated household employment tax laws and benefit information.
The IRS annually reviews, and adjusts as necessary, the wage payment threshold that obligates a family to pay Social Security and Medicare taxes. These tax withholdings are reported annually on a W-2. This threshold will increase to $2,800 for 2025.
If you employ a nanny, senior caregiver, or other household worker, it’s essential to stay informed about payroll tax obligations — especially the FUTA Credit Reduction, which can impact the amount of federal unemployment tax you owe. If you’re not familiar with this term, don’t worry. We’re here to explain what it means, how it works, and how it might affect your payroll in 2024.
Topics: nanny, senior, CPA, Household payroll compliance, FUTA Credit Reduction
