- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
How would you handle a nanny from a legal and accounting standpoint
Posted on 1/18/22 at 9:56 am
Posted on 1/18/22 at 9:56 am
We are looking at picking up a nanny soon. I was just curious the best way to pay her and have any paperwork set up.
Do you set up an LLC and pay her through the LLC so she can't sue you individually?
From an accounting standpoint how should this be set up?
Should there be a contract in place?
Any recourse from just paying her cash with no paperwork or LLC in place?
Do you set up an LLC and pay her through the LLC so she can't sue you individually?
From an accounting standpoint how should this be set up?
Should there be a contract in place?
Any recourse from just paying her cash with no paperwork or LLC in place?
23
Posted on 1/18/22 at 10:07 am to JL
How many hours per week will this nanny be working?
Posted on 1/18/22 at 10:08 am to DumpsterFire
40
Posted on 1/18/22 at 10:19 am to JL
Sorry, I'm going to withhold giving any advice since it is much more complicated than I originally thought. I'd guess that 95% of people probably pay their nanny via cash/check and then go about their lives. This isn't the correct way to deal with it (also it is technically tax evasion), but, it is a lot less work on your part.
This post was edited on 1/18/22 at 10:35 am
Posted on 1/18/22 at 10:22 am to JL
cash is way easier.
technically yes since they don't qualify as a contractor due to you setting their hours you can't just pay cash and let them deal with taxes, you are supposed to deduct them as an employer and pay your employment taxes etc. But its a hassle to do all that for one single employee who would rather just be paid in cash.
quote:
Any recourse from just paying her cash with no paperwork or LLC in place?
technically yes since they don't qualify as a contractor due to you setting their hours you can't just pay cash and let them deal with taxes, you are supposed to deduct them as an employer and pay your employment taxes etc. But its a hassle to do all that for one single employee who would rather just be paid in cash.
This post was edited on 1/18/22 at 10:25 am
Posted on 1/18/22 at 10:58 am to JL
If it's her full time job you better file a household employee W2. If a second job. Cash money.
Posted on 1/18/22 at 11:29 am to JL
quote:
Do you set up an LLC and pay her through the LLC so she can't sue you individually?
An LLC set up purely for you to pay a nanny is most likely going to have the corporate veil pierced with the quickness
Posted on 1/18/22 at 11:34 am to JL
Pictures of nanny needed to answer this question.
Posted on 1/18/22 at 11:49 am to JL
I suggest looking at some software to manage it for you. Some can handle payments as well, but you at least want one that will calculate tax withholdings and create forms.
If you're that worried about getting sued, I would talk to an atty before creating an LLC.
If you're that worried about getting sued, I would talk to an atty before creating an LLC.
This post was edited on 1/18/22 at 11:49 am
Posted on 1/18/22 at 11:53 am to JL
Actually scratch all that, it does seem a bit more complicated because health insurance, ability to file unemployment and all that other stuff is involved.
If you want to do it legally.
If you want to do it legally.
This post was edited on 1/18/22 at 11:59 am
Posted on 1/18/22 at 12:01 pm to TheChosenOne
quote:
I suggest looking at some software to manage it for you. Some can handle payments as well, but you at least want one that will calculate tax withholdings and create forms.
quote:
A service like Care.com’s HomePay will take care of most of the details (direct deposit, generating the W-2, apportion all the taxes, tell you if you need to buy workers’ comp, etc.)
Also got to remember laws vary by state.
Posted on 1/18/22 at 12:23 pm to dgnx6
quote:
Actually scratch all that, it does seem a bit more complicated because health insurance, ability to file unemployment and all that other stuff is involved.
And let's not forgot worker's comp. If she gets hurt while on the job, you are 100% responsible for all her medical bills regardless of who is at fault.
Posted on 1/18/22 at 1:36 pm to JL
I would suggest you have a convo with an attorney to see if an LLC would actually provide you protection in your state, with this situation.
The easiest/safest way is to go through an agency, it's also the most expensive.
We have a few clients that are set up as a Household Employer. They give them a W-2, pay payroll taxes on Schedule H, file state unemployment taxes, etc.
I have two clients that only use the nanny for like 5 hours a week, and the nanny has other families she works with... we do a 1099 for them.
I am certain I have clients who tell me "no, we don't have a nanny" and them pay them cash and I have no idea.
The easiest/safest way is to go through an agency, it's also the most expensive.
We have a few clients that are set up as a Household Employer. They give them a W-2, pay payroll taxes on Schedule H, file state unemployment taxes, etc.
I have two clients that only use the nanny for like 5 hours a week, and the nanny has other families she works with... we do a 1099 for them.
I am certain I have clients who tell me "no, we don't have a nanny" and them pay them cash and I have no idea.
Posted on 1/18/22 at 1:40 pm to JL
Is she a US citizen?
This post was edited on 1/18/22 at 1:41 pm
Posted on 1/18/22 at 1:46 pm to JL
quote:
Do you set up an LLC and pay her through the LLC so she can't sue you individually?
LLC is overkill. You should pay her a salary and deduct the employer portion out to pay in for her.
Care.com has a site that helps with this. I believe an alternate is NannyChex or something like that.
I highly doubt you end up doing this.
quote:
Should there be a contract in place?
Hell yes. You need to talk salary or hourly pay, taxes if applicable, PTO, excessive tardiness, cell phone policies, holidays, household chore expectations, and everything else you can think of that could apply from your own place of work.
quote:
Any recourse from just paying her cash with no paperwork or LLC in place?
Besides the $25,000 fines and back taxes, not really. Unless you do some weird shite, there is no way you should ever get audited for paying someone $800 cash every week.
This post was edited on 1/18/22 at 1:48 pm
Posted on 1/18/22 at 1:48 pm to JL
What city?
Posted on 1/18/22 at 3:05 pm to Wallace Ritchie
quote:
Pictures of nanny needed to answer this question.
This… there are rules.
FWIW i dated a 19 yr old ‘au pair’ from the Czech Republic when i was like 24…. No idea what she made, i know it was shite wages, but we had a lot of fun.
Posted on 1/18/22 at 3:21 pm to BK Lounge
quote:
No idea what she made, i know it was shite wages, but we had a lot of fun.
I think they are in the $19,000-$24,000 range but you obviously have another person living with you and inevitably another mouth to feed.
Posted on 1/18/22 at 3:23 pm to JL
A word of caution… if you are going to pay under the table you better know the person pretty well. If you part ways and they file for unemployment, the IRS will come knockin. A buddy found this out the hard way. Hire a CPA and do it right.
Posted on 1/18/22 at 3:38 pm to TigerDeBaiter
quote:
If you part ways and they file for unemployment, the IRS will come knockin. A buddy found this out the hard way.
Bold move by the employee. Wouldn't they be on the hook for unpaid taxes as well?
Page 1 of 3
Popular
Back to top
Follow TigerDroppings for LSU Football News