Question

Is there action I need to take if I paid a babysitter/nanny over the threshold last year (2020)?

Forum|Forum|5 years ago
March 18, 2021
3 replies
0 views

She worked in our home. I claimed the amount I paid and used her SSN. I didn't receive any prompts to submit a W2 or anything. She is asking me where her W2 is and I don't know what to do. Also, I already filed. Please help. Thank you.

TurboTax Premier Online

LenaH

Yes. Per the IRS, you will need to file a W-2, W-3, and a Schedule H on your 1040 if you paid your nanny more than $2,200 for the year.

The IRS encourages you to file the W-2 and W-3 electronically. If filing electronically via the SSA's Form W-2 Online service, the SSA will generate Form W-3 data from the electronic submission. You can file electronically with the SSA at the page Employer W-2 Filing Instructions & Information.

Once your return is accepted, you will have to amend your return to file Schedule H as well. Please follow the directions on the How do I amend my 2020 return?

To file a Schedule H, Household Employment Taxes, with your return, please follow the instructions below:

Open or continue your return in TurboTax.
Search for sch h with the magnifying glass tool at the top of the page.
Select the Jump to link at the top of the search results.
Answer Yes to Did You Have a Nanny or Household Employee? and follow the instructions.

For IRS guidelines on the Schedule H, W-2, and W-3 for household employees, please see IRS Instructions for Schedule H (2020).

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macuser_22

Employee

*You* do not file a W-2 in TurboTax, the nanny files the W-2 that you provide her with. You file the schedule H (household employee) tax.

See IRS Pub 926 for details.

https://www.irs.gov/pub/irs-pdf/p926.pdf

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**

M

matthewstansberrAuthor

Thank you for everyone's help so far @LenaH @macuser_22 . This is very confusing and uncharted territory for me. Am I on the right track?

Before I can issue her a W2 (now very late), I need to register with the IRS to obtain an EIN, Amend my 2020 taxes (pending) tile a Schedule H, register with SSA to file the W2 and W3 documents? I asked her to fill out a W4 already.

Sidenote: Why didn't TurboTax lead me through these prompts after claiming the amount for child care?

Respectfully,

Matt

macuser_22

Employee

The child care deduction and household employee reporting are totally separate things. Most taxpayer do not have a household employee and you can have a household employee with no child at all.

A W-4? It it too late to withhold 2020 tax now - 2020 is over.

Tax withholding is not required unless you BOTH agree per the IRS Pub 926:

The household employer rules for federal income tax withholding have not changed. That is, you're not required to withhold federal income tax from wages you pay a household employee. You should withhold federal income tax only if your household employee asks you to withhold it and you agree. Employers will figure withholding based on the in-formation from the employee's most recently submitted Form W-4, Employee’s Withholding Certificate. Similarly, any employees hired prior to 2020 who wish to adjust their withholding must use the redesigned form. For the latest information about developments related to Form W-4,

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**

M

matthewstansberrAuthor

Thank you for that explanation @macuser_22 . Things are beginning to look more clear. The only agreement we had was for her to watch my kids while my wife and I worked. There was no discussion of withholding tax.

Tax season came, and I wanted to claim the amount I paid, naturally. I claimed the amount through Turbo Tax, used her SSN with her permission. She needs to file her taxes and asked me for a W2. How do I tell her to proceed? Is there anything I need to do?

Thanks for your help.

- Matt