Hiring a Nanny
The following is excerpted from The Court TV Cradle-to-Grave Legal Survival Guide, an easy-to-read, in-depth explanation of the law as it affects all aspects of daily life. You can order the book, published by Little, Brown and Company, from our online store. It also is available in local bookstores, or you can call Little, Brown directly at (800) 333-3476.
Can a mother charge money to take care of her own child and others without a license?
Not necessarily. The laws vary from state to state, and many states require a license if you accept payment to care for children not related to you by blood. However, if your own children are also present, the licensing rules are sometimes more lenient. Of course, many people rely on neighbors and friends who have children as a low-cost alternative to formal day-care programs. The laws of your state will dictate whether or not you need a license to supervise those other children.
Does a parent have to pay taxes for a full-time babysitter?
Yes. If, like Beatrice, you hire a full-time babysitter you are considered an employer and are required to comply with employment laws, just as any company must do. Mostly this involves withholding money for Social Security and Medicare and forwarding that payment to the federal government. You may also owe money for federal and state unemployment taxes and for state workers' compensation. You are not required to withhold federal income taxes unless your babysitter asks you to and you agree.
What if the babysitter just works part-time?
If you pay him or her more than $1,000 in a one-year period, you must pay the Social Security, unless the babysitter is under age 18 and lists "student" as his or her principal occupation. Because people generally hire babysitters on a very informal basis, most people don't realize that they have to pay taxes. But with the recent furor over people in public office not complying with this law, you should be aware that these requirements exist and that you could be subject to civil and criminal penalties if you fail to comply. In practice, the Internal Revenue Service rarely pursues people who don't pay, but it could.
