- Register with federal and state taxing authorities to obtain Tax Identification Numbers.
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- Maintain current employee file with completed documentation - Forms W-4 and I-9 with appropriate backup.
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- Comply with state New Hire Reporting requirements.
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- Choose pay cycle: weekly, bi-weekly, semi-monthly, or monthly.
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- Withhold FICA taxes from household employees earning more than $1,700 in the current year.
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- Match FICA withholding tax calculated at 7.65% for employee and 7.65% for employer.
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- Withhold federal and state income tax at the request of the employee. Note, it is not required to withhold federal and state taxes from household employees unless they request you to do so.
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- Domestic service by persons under the age of 18 is exempt from coverage unless it is the worker's principle occupation.
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- Remit state and federal unemployment insurance premiums quarterly or annually.
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- Remit withholding taxes to proper authorities on a quarterly and/or annual basis.
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- Adjust tax withholdings from personal wages or increase quarterly estimated tax payments to absorb the employment taxes owed as a result of hiring household employees.
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- Prepare annual wage statement (Form W-2 for each employee).
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- Report annual wage information to Social Security Administration.
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- Report withholding tax on Schedule H.
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- Eligible individuals may partake in a flexible spending plan offered by employers to pay for child and dependent care expenses.
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- Eligible families may receive a tax credit for incurring dependent care costs.
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- Contact your State's Workers Compensation Board to find out if you are required to maintain a workers compensation policy.
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