{"id":16351,"date":"2018-08-10T11:18:05","date_gmt":"2018-08-10T15:18:05","guid":{"rendered":"https:\/\/gtm.com\/household\/?p=16351"},"modified":"2020-02-10T13:46:37","modified_gmt":"2020-02-10T18:46:37","slug":"irs-nanny-tax-compliance","status":"publish","type":"post","link":"https:\/\/gtm.com\/household\/irs-nanny-tax-compliance\/","title":{"rendered":"IRS Takes Aim at Nanny Tax Compliance"},"content":{"rendered":"
\"Nanny

The IRS may focus on nanny tax compliance through a combination of enforcement and education.<\/p><\/div>\n

Billions of dollars in tax revenue is lost each year in unpaid \u201cnanny taxes.\u201d The IRS is taking notice of the nanny tax compliance issue and could be putting household employers on alert.<\/p>\n

In June, a study of nanny tax compliance<\/a> by Brian Erard of B. Erard & Associates and sponsored by the International Nanny Association was presented to the IRS\/Tax Policy Center Joint Research Conference on Tax Administration in Washington, D.C. The report estimated that between $3.3 to $5.7 billion in nanny taxes goes unreported to the IRS.<\/p>\n

A recommended course of action for the IRS to improve nanny tax compliance includes:
\n\u2022 Increasing enforcement
\n\u2022 Outreach and education for household employers and their employees on their rights and responsibilities
\n\u2022 Clarifying confusing IRS publications including Publication 926
\n\u2022 Working with states on compliance
\n\u2022 Requiring income tax withholding in household employment, the only situation in which withholding is optional
\n\u2022 Offering an amnesty period for employers to pay back taxes with reduced penalties<\/p>\n

Nanny tax compliance enforcement could take a two-pronged approach.<\/p>\n

Tax letter audits could be targeted to two-income families with children in the household but no child care expenses claimed. Also, the IRS could seek to increase awareness of nanny tax compliance and make it easier for families to follow the law.<\/p>\n

If you\u2019re not sure about how to pay nanny taxes or if you\u2019re doing them right, check out our nanny tax guide<\/a>, which explains everything and will help you every step of the way.<\/p>\n

Looking to become compliant in the easiest way possible? Call GTM Payroll Services at (800) 929-9213 for a free, no-obligation consultation with a household employment expert. We\u2019ll manage your tax, payroll, and insurance obligations without the risks and hassles of trying to do it yourself.<\/p>\n

Download The Complete Guide to Household Payroll<\/h2>\n

Get our complimentary guide and learn everything you need to know about paying your employees legally and filing your taxes the right way.
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