by HomeWork Solutions
Nannies are the employees of the families they work for. As defined by the Fair Labor Standards Act(FLSA) and by IRS Document 926. As such they should receive a W-2
each January to account for the wages paid the previous year. Unfortunately, sometime families are unaware that in hiring a nanny, they became household employers with tax and labor law obligations. Nannies who have not received a W-2 from their employer can follow the steps below to resolve the issue.
January 31st– IRS requires employers to mail W-2s by this date.
February 15th – The earliest date the IRS considers the W-2 missing. This allows for regular, and slightly delayed mail to arrive. If the nanny does not receive a W-2 by this date, they should phone the employer. Allow two additional weeks for the W-2 to arrive if the employer had the wrong address for the nanny, and a new document needs to be mailed.
If the employer, did not intend to provide a W-2, try to resolve the issue. The nanny can remind the employer nannies are entitled to a Form W-2. Hopefully this call will resolve the issue quickly, and the employer will now issue a W-2.
Note: The employer is responsible to remit the Social Security and Medicare taxes, as well as pay unemployment insurance. The employer is NOT responsible for the nanny’s income taxes unless it was agreed to in the written work agreement.
Resolution Without the Cooperation of the Employer
If after speaking with the employer, it is clear they have no intention of issuing a W-2, the nanny will still need to declare the income to the IRS.
If no tax form was provided, the nanny will need to do so by completing Form 4852 Substitute Form W-2. Additional information on completing this form can be found in the HomeWork Solutions Knowledge Center article, What Do I Do – I Didn’t Get a W-2 .
Note: The IRS requests that employees wait until April 15th to file their return, in the hopes the employer will come around and provide the correct documentation. The nanny cannot eFile when using a substitute Form W-2. The conventional paper tax return is mailed to the appropriate address.
If the family incorrectly provided the nanny a 1099 MISC, and will not course correct to provide a W-2. The nanny will need to use Form 8919 Uncollected Social Security and Medicare Taxes on Wages. Additional information on completing this form can also be found in the HomeWork Solutions What Do I Do – I Didn’t Get a W-2 article.
When a Form 4852 or Form 8919 are filed by the nanny, the employer will be questioned by the IRS and the IRS will assume responsibility for collection of employment taxes. It is important to note however, the nanny always remains responsible for their federal income taxes, as well as state and local if applicable.
HomeWork Solutions specializes in providing household employers and their tax preparers real solutions for nanny tax compliance. We are nationally recognized experts in the field of household employment taxes, regularly consulted by media such as the New York Times and Wall Street Journal.