Discussion:HOUSEHOLD EMPLOYEE TAXES - EXPENSES WRITTEN OFF???
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Discussion Forum Index --> Tax Questions --> HOUSEHOLD EMPLOYEE TAXES - EXPENSES WRITTEN OFF???
Jvgiardelli (talk|edits) said: | 18 March 2007 |
| I HAVE A CLIENT WHO HAS A NANNY AND HE GAVE HER A W-2 & WITHHELD TAXES. I KNOW TO FILE TO SCHEDULE H BUT......
ARE ANY OF THESE EXPENSES (EMPLOYER SHARE OF SOCIAL SECURITY & MEDICARE TAXES), INCLUDING THE STATE UI & TRAINING TAX A DEDUCTION FOR THE TAXPAYER AND WHERE WOULD YOU SHOW THESE EXPENSES ON HIS PERSONAL TAX RETURN? | |
Mtmckeecpa (talk|edits) said: | 18 March 2007 |
| Jvq,
No way, no deduction here. | |
Www.cpa1.biz (talk|edits) said: | 18 March 2007 |
| This type of expense is horrible. Just see if you can put the amount paid for child care expense if this was in fact for help to watch the client's children when the taxpayers went to work. Try to get the child care tax credit. | |
| 18 March 2007 | |
| In one client's case, the full time nanny was needed because a child was severely handicapped and the single parent had to work. What didn't qualify for dependent care credit counted as medical expense, because the child was not supposed to be left alone. It was a sad story, the 14 year old girl had the mind of a 2 year old. | |
| 18 March 2007 | |
| Look over the instructions for Form 2441 and Sch H . I think that the taxes you mentioned plus the nanny's salary are considered qualifying expenses for Form 2441. However, the nanny's salary itself usually exceeds the limit for Form 2441. | |
| 18 March 2007 | |
| TJ has it right. But in that rare case where nanny salary does NOT exceed the limit for Form 2441, YES, if taxpayer paid for the taxes, or even if taxpayer only paid his half (talking SS, MED here), yes, it counts towards Child Care Credit, assuming both spouses work if MFJ. My few clients who disclose to me that they have a nanny generally pay both halves of the FICA tax. | |
| 18 March 2007 | |
| Kendrick, I agree with you re: the fact that many individuals that employ a nanny pay both halves of the FICA tax. As a sidebar, I may be to conservative here, but if audited, the IRS may make you "gross up" the Nanny's W-2 for the employee's portion of the FICA that your client's paid as it would be considered income to the Nanny. i know that we are not talking about a lot of money here. | |
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