Household Employees

So do you have a Household Employee?

Any person who comes into your home, where you control what and how that person’s work gets done, can be considered your employee.  Typically these individuals are babysitters, nannys, maids, or healthcare workers.  As the employer, you would provide the tools needed for the job.  These individuals are generally NOT provided through an agency and often do not work for other individuals.

As an employer, you must file Sch H of Form 1040  to pay the FICA, FUTA and any withheld federal income taxes.  You should consult a tax advisor or IRS publications for the point at which FICA and FUTA become required.  These individuals are paid on W2s, so the employer must get an Employer Identification Number (EIN) from the federal government and must obtain social security numbers and addresses from employees.

Employees are also required to fill out an I-9 indicating they are eligible to work in the US and their wages are likely subject to state unemployment as well.

The initial set up can be time consuming, but the overall work involved is not difficult for the average tax payer with guidance from a qualified preparer.  Those that need the in home assistance should not let this scare them off.  After all, if you remember, that’s what got several congressmen in trouble years ago for failing to issue W2s to their maids!  Set it up properly in the beginning, and you will not need to worry about IRS!


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