Are You an Employer?
You don't have to pay taxes on payments that you make to independent
contractors, because they are treated as business owners themselves,
and they're responsible for paying their own self-employment taxes.
If you get domestic workers through an agency, the agency is generally
considered the employer. But if you use individual workers and your
arrangement gives you the right to control not only the type of work
that must be done, but how it must be done (such as what specific
tasks must be done by a maid, what cleaning products should be used,
etc.), you will be considered an employer.
Generally, you
must withhold and pay Social Security and Medicare taxes if you paid
any one employee cash wages of $1,900 or more in 2014, unless the
worker was a student under age 18 at any time during the year. You
must pay federal unemployment tax if you paid total cash wages of
$1,000 or more in any calendar quarter to any number of household
employees.
However, if you hire your spouse or your child
under age 21, you don't need to pay any payroll taxes. If you hire
your parent, you don't pay federal unemployment tax, and you don't
need to pay Social Security or Medicare tax unless your parent cares
for a child who lives with you and is under 18 or disabled, and you
are divorced and not remarried, you are widowed, or you're married
to a person whose physical or mental condition prevents him or her
from caring for the child.
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Warning You may have to pay state payroll taxes,
even if you don't owe federal taxes. |
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