3 ms·

Out of curiosity, what made it difficult? Not knowing what was required for sure? Figuring out how to fill out the 1099-MISC? Knowing how to file it with the I

Out of curiosity, what made it difficult? Not knowing what was required for sure? Figuring out how to fill out the 1099-MISC? Knowing how to file it with the IRS/state? I remember it being a bit tricky at first but once I knew the right form it only took a few minutes. The hard part for me is keeping track of rule changes. Payroll service works though =)

sveiss 2y ago
If they’re trying to follow the rules, then they can’t just fill out a 1099-MISC. A babysitter one of the examples specifically called out as a household employee in the IRS guidance[1], so if you’re doing it right you should be running payroll. That’s pretty tricky to DIY properly. [1] https://www.irs.gov/taxtopics/tc756 https://www.irs.gov/taxtopics/tc756
- sbrother 2y ago
  I can see doing this for a nanny, but surely no one is jumping through all these hoops for ad-hoc, hourly babysitting? Any of the random highschoolers or college kids I've used would look at me like I was crazy if I tried to set them up on payroll lol.
  - nkrisc 2y ago
    It depends on if your yearly payments to them exceed some threshold. There may be more to it than that, of course. Don’t listen to me, I’m the idiot who couldn’t figure it out.
    - neltnerb 2y ago
      Gotcha, thanks for the explanation. Sounds like too much hassle to DIY for sure, I guess their classification logic makes sense.
    - sgerenser 2y ago
      Per care.com[1], the threshold is $2700 per year: For all intents and purposes, a babysitter is looked at just like a nanny in that if they must adhere to the schedule you set and come to your home to take care of your kids based on the rules you set, the IRS will most likely view this as an employment relationship. And taxes can sneak up on you quickly. If the babysitter earns just $15 per hour and works even 10 hours per week, you’ll cross the $2,700 tax withholding threshold in a little over four months. [1] https://www.care.com/hp/do-you-need-to-pay-taxes-for-your-part-time-caregiver https://www.care.com/hp/do-you-need-to-pay-taxes-for-your-pa...
      - ghaff 2y ago
        I have a housekeeper who only comes in once a month and (I learn) is fairly inexpensive though it doesn’t seem that way. Weekly it would be way over the threshold. I assume my lawn guy whose basic work is under that threshold —and has a business—doesn’t count either although he does other jobs as well for me and others. But that’s true of contractors generally. So I assume one just does what most people do in common situations. And at some point you just pay cash.
  - int_19h 2y ago
    Yes, most people don't comply with the law in this regard. Which tells you volumes about the practicality of said law.
itronitron 2y ago
The complexity will vary by state. But basically you have to create a small business with a unique tax id, then pay into your employee's social security benefits.
nkrisc 2y ago
No 1099, it needed to be a W2. What made it difficult was: finding out we needed to do anything at all, finding out what that “anything” even was, finding instructions for doing it, parsing the instructions and figuring out if we were reading the correct instructions, figuring out if the various exceptions and other special clauses applied, researching those, then figuring out how to actually do any of this, and so on, and then again a second time for state taxes. Nevermind going down the rabbit whole of trying to figure out if we need an EIN and then repeating the same discovery and learning process for just that small part of the whole entire thing. Honestly it would have been a full time job for me to successfully navigate it all. I don’t see how it’s possible to do without already being a CPA or accountant of some sort. It’s an entire domain of knowledge and I had almost none of that knowledge. There’s too much else going on in my life to begin to delve into all that. All this for a baby sitter 16 hours a week.
- kanbara 2y ago
  > “all this for…” — you’re employing someone for 40% a full time duration. of course you need to do the right thing, ensure they get the right wage, if you need to pay benefis, etc. this is such a privileged position and you think you should’ve just been able to pay cash and potentially screw someone over?
  - nkrisc 2y ago
    That’s not even remotely close to what I said. I went through all the trouble because I thought it was the right thing to do and I wanted to do right by the babysitter. It’s why I ended up paying an accountant a larger lump of money than I would have liked to in order to get it all sorted out. Im complaining how difficult it is to do the right thing.
    - neltnerb 2y ago
      Sorry about that other poster, I appreciate your answer to my question. Thinking it's a lot for an individual household to have to identify and do this much paperwork for childcare is an entirely reasonable response. As is doing taxes in the US in general... it can be both obnoxiously overboard and also be well intended. I did not read anything in your post that suggested you resented the babysitter or having to pay money to do it properly. I read the exact opposite, that more people would if the process were not so burdensom of people who obviously have a child and so presumably not a ton of time for paperwork. After all, you did it properly... what's to get angry about other than the topic of the original article, that tax paperwork is overboard?

sveiss 2y ago

If they’re trying to follow the rules, then they can’t just fill out a 1099-MISC. A babysitter one of the examples specifically called out as a household employee in the IRS guidance[1], so if you’re doing it right you should be running payroll. That’s pretty tricky to DIY properly. [1] https://www.irs.gov/taxtopics/tc756 https://www.irs.gov/taxtopics/tc756

sbrother 2y ago
I can see doing this for a nanny, but surely no one is jumping through all these hoops for ad-hoc, hourly babysitting? Any of the random highschoolers or college kids I've used would look at me like I was crazy if I tried to set them up on payroll lol.
- nkrisc 2y ago
  It depends on if your yearly payments to them exceed some threshold. There may be more to it than that, of course. Don’t listen to me, I’m the idiot who couldn’t figure it out.
  - neltnerb 2y ago
    Gotcha, thanks for the explanation. Sounds like too much hassle to DIY for sure, I guess their classification logic makes sense.
  - sgerenser 2y ago
    Per care.com[1], the threshold is $2700 per year: For all intents and purposes, a babysitter is looked at just like a nanny in that if they must adhere to the schedule you set and come to your home to take care of your kids based on the rules you set, the IRS will most likely view this as an employment relationship. And taxes can sneak up on you quickly. If the babysitter earns just $15 per hour and works even 10 hours per week, you’ll cross the $2,700 tax withholding threshold in a little over four months. [1] https://www.care.com/hp/do-you-need-to-pay-taxes-for-your-part-time-caregiver https://www.care.com/hp/do-you-need-to-pay-taxes-for-your-pa...
    - ghaff 2y ago
      I have a housekeeper who only comes in once a month and (I learn) is fairly inexpensive though it doesn’t seem that way. Weekly it would be way over the threshold. I assume my lawn guy whose basic work is under that threshold —and has a business—doesn’t count either although he does other jobs as well for me and others. But that’s true of contractors generally. So I assume one just does what most people do in common situations. And at some point you just pay cash.
- int_19h 2y ago
  Yes, most people don't comply with the law in this regard. Which tells you volumes about the practicality of said law.

itronitron 2y ago

The complexity will vary by state. But basically you have to create a small business with a unique tax id, then pay into your employee's social security benefits.

nkrisc 2y ago

No 1099, it needed to be a W2. What made it difficult was: finding out we needed to do anything at all, finding out what that “anything” even was, finding instructions for doing it, parsing the instructions and figuring out if we were reading the correct instructions, figuring out if the various exceptions and other special clauses applied, researching those, then figuring out how to actually do any of this, and so on, and then again a second time for state taxes. Nevermind going down the rabbit whole of trying to figure out if we need an EIN and then repeating the same discovery and learning process for just that small part of the whole entire thing. Honestly it would have been a full time job for me to successfully navigate it all. I don’t see how it’s possible to do without already being a CPA or accountant of some sort. It’s an entire domain of knowledge and I had almost none of that knowledge. There’s too much else going on in my life to begin to delve into all that. All this for a baby sitter 16 hours a week.

kanbara 2y ago
> “all this for…” — you’re employing someone for 40% a full time duration. of course you need to do the right thing, ensure they get the right wage, if you need to pay benefis, etc. this is such a privileged position and you think you should’ve just been able to pay cash and potentially screw someone over?
- nkrisc 2y ago
  That’s not even remotely close to what I said. I went through all the trouble because I thought it was the right thing to do and I wanted to do right by the babysitter. It’s why I ended up paying an accountant a larger lump of money than I would have liked to in order to get it all sorted out. Im complaining how difficult it is to do the right thing.
  - neltnerb 2y ago
    Sorry about that other poster, I appreciate your answer to my question. Thinking it's a lot for an individual household to have to identify and do this much paperwork for childcare is an entirely reasonable response. As is doing taxes in the US in general... it can be both obnoxiously overboard and also be well intended. I did not read anything in your post that suggested you resented the babysitter or having to pay money to do it properly. I read the exact opposite, that more people would if the process were not so burdensom of people who obviously have a child and so presumably not a ton of time for paperwork. After all, you did it properly... what's to get angry about other than the topic of the original article, that tax paperwork is overboard?