If you run a business and employ household help, can you pay that employee through your company payroll? This is a common tax question that can affect your personal and company finances. The short answer is no – a household employee shouldn’t be paid by a corporate entity through their business payroll. Here’s why.
Hiring household employees comes with responsibilities and legal obligations. Understand the essential aspects of hiring household employees, employment taxes, and how to ensure a smooth and lawful employment relationship.
When paying your nanny, you can pay them in arrears or current. Here are the differences between the two methods and why paying in arrears may work best for your family.
For a few reasons, like qualifying for a health insurance subsidy or taking home more money, a nanny may want to be paid half on and half off the books. This may seem like a reasonable compromise especially if you like the caregiver. Plus, you save on taxes too. Everyone is happy. Right? Here are four key reasons why this is a bad idea even if well-intentioned.
Don’t create risks or hassles for yourself with a cheap nanny tax service. They’ll do the bare minimum: pay your employee and take out some withholdings. You need more than that to comply with tax, wage, and labor laws. You deserve the support and attention of household payroll professionals when handling your nanny taxes.
Download our free guide and find out everything you need to know about paying your employee legally and filing your taxes.
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