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

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

Updated December 2024

Every year HomeWork Solutions prepares a summary of new or updated household employment tax laws and benefit information.

HOUSEHOLD EMPLOYEE 2025 WAGE THRESHOLD:

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.

Topics: nanny, agency, senior, CPA

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

Correcting the mistake of wages paid under the table is the right thing to do, and we can help.

Topics: nanny, senior, CPA, Pay caregiver on the books, How to pay a nanny legally, Household payroll service, Pay nanny legally, Back taxes for nannies

As a household employee, planning for your retirement is one of the most important steps you can take for your future. While Social Security provides a foundation, building additional savings through retirement accounts can help ensure long-term financial security. Here’s some tips on retirement planning, the retirement savings options available, and information on how building an employer contribution into your total compensation plan can help.

Topics: nanny, senior, CPA, retirement savings account, HomeWork Solutions retirement support, nanny retirement savings, caregiver nanny retirement savings, household employee retirement savings

When managing household payroll, many people wonder if they should set up a Limited Liability Company (LLC) for additional protection. While the idea of an LLC can be appealing, it’s generally unnecessary for household employers and often doesn’t provide the legal or financial protection you might expect. Here’s why setting up an LLC is usually more trouble than it’s worth for household employment.

Topics: nanny, senior, CPA, Should I set up an LLC for household payroll, paying a nanny, household LLC, Managing household payroll taxes, Household payroll compliance

At HomeWork Solutions, we understand that household employment can bring unique challenges for CPAs and financial professionals. Whether it’s a client who just hired a nanny or a question about how to handle household payroll taxes, we're here to make sure you have the insights you need. To help you guide your clients confidently, we’ve compiled a list of nine essential tips that will keep you on the right track.

Topics: CPA, homework solutions

As a CPA, your expertise is unparalleled, but staying abreast of every niche area of accounting can be overwhelming. Industry-specific laws and regulations, especially those governing household employees, are complex and ever-evolving. This is where outsourcing can make a significant difference, relieving you from the burden of constant learning and allowing you to provide more comprehensive service to your clients.

Topics: household payroll, CPA, schedule H

Minimum wage will be increasing in many states and cities across the country.  As longtime advocates for fair and legal pay, we believe this is long overdue!  Domestic employees deserve a living wage that fairly compensates them for the invaluable work they do to keep our households running.

Topics: senior care, nanny, agency, senior, CPA