As a parent, there are just some things you always do by the book. You would never forget to buckle your daughter into her car seat or leave your sitter without an emergency contact. And, how you pay your nanny, sitter, in-home caregiver or housekeeper shouldn’t be any different. Beyond tax deductions for you, paying your caregivers legally offers many benefits for the ones you entrust with your loved ones. If you need help navigating how to pay legally or simply want to know why it’s beneficial for you both in the long run, Care.com HomePay is here to help. Read on to learn more about this highly rated, underutilized service most parents should be using but aren’t.
1. Are you hiring help this year? Here’s what you need to know
Are you hiring a nanny, an in-home caregiver, a housekeeper or personal assistant this year? According to the IRS, you now have a “household employee.” And if you pay them $2,200 or more per year, guess what? You owe taxes. Thankfully, HomePay makes it easy to manage what can feel like a daunting undertaking on top of everything else you do for your family.
2. Paying your nanny legally benefits everyone
Cutting a weekly check may seem like the easiest option at the time (for both of you), but did you know there are many benefits to paying your nanny and other caregivers legally?
According to HomePay, here are just a few:
- You can save money by taking advantage of tax breaks.
- You won’t have to worry about getting audited and owing thousands of dollars in back taxes and fines.
- Your caregiver can build traceable employment history as well as increase his or her future retirement benefits.
- He or she can work toward eligibility for premium-free Medicare hospital insurance.
- When your family no longer needs care, your caregiver can receive unemployment benefits until he or she finds a new job.
3. Here’s how HomePay can help
With easy-to-use tools, HomePay breaks down otherwise complex and time-consuming tasks. Here are some of the services they offer that streamline everything from payday to tax time:
- HomePay files state and federal tax returns and payments on your behalf, prepping year-end tax docs and W-4 forms.
- No need to keep up to date on the most recent tax laws. HomePay stays on top of changes in tax laws as well as tax breaks that can save you money.
- HomePay can help with payroll, HR support and budget planning, saving you time and alleviating stress.
4. It’s easy—and recommended
HomePay is the trusted source for household employment, serving 60,000 families over the past 25 years. They are highly rated with 96% of their customers recommending their services. Since 1992, HomePay has filed over $2 million in tax filings and processed over $4 billion through their payroll services. With HomePay, customers enjoy concierge support where no question is too small, and no problem is too big for their experts.
Disclaimer: We are not tax professionals. The content herein is not intended to be a substitute for professional tax advice.