Employment Taxes for Household Employees

How Do You Make Tax Payments?

When you file your 1999 federal income tax return in 2000, attach Schedule H, Household Employment Taxes, to your Form 1040. Use Schedule H to figure your total household employment taxes (social security, Medicare, FUTA, and withheld federal income taxes). Add these household employment taxes to your income tax. Pay the amount due by April 17, 2000.

You can avoid owing tax with your return if you pay enough tax during the year to cover your household employment taxes, as well as your income tax. If you are employed, you can ask your employer to withhold more federal income tax from your wages in 1999. If you get a pension or annuity, you can ask the payer to withhold more federal income tax from your benefits. Or, you can make estimated tax payments for 1999 to the IRS, or increase your payments if you already make them.

Asking for more federal income tax withholding. If you are employed and want more federal income tax withheld from your wages to cover the employment taxes for your household employee, give your employer a new Form W-4, Employee's Withholding Allowance Certificate. Complete it as before, but show the additional amount you want withheld from each paycheck on line 6.

If you receive a pension or annuity and want more federal income tax withheld to cover the employment taxes for your household employee, give the payer a new Form W-4P, Withholding Certificate for Pension or Annuity Payments (or a similar form provided by the payer). Complete it as before, but show the additional amount you want withheld from each benefit payment on line 3.

To make sure you will have the right amount withheld, order ppublication 909, Is My Withholding Correct for 1999?. It will help you compare your total withholding for 1999 with the combined income tax and employment taxes that you can expect to figure on your 1999 return.

Paying estimated tax. If you want to make estimated tax payments to cover the employment taxes for your household employee, get Form 1040-ES, Estimated Tax for Individuals. Use its payment vouchers to make your payments. You can pay all of the employment taxes at once, or you can pay them in installments. If you have already made estimated tax payments for 1999, you can increase your remaining payments to cover the employment taxes. Estimated tax payments for are ordinarily due April 15, June 15, and September 15, 1999, and January 15th of the following year.

Payment option for business employers. If you own a business as a sole proprietor or your home is on a farm operated for profit, you can choose either of two ways to pay the 1999 federal employment taxes for your household employee. You can pay them with your federal income tax as described above, or you can include them with your federal employment tax deposits or other payments for your business or farm employees.

If you pay the employment taxes for your household employee with your business or farm employment taxes, you must report your household employment taxes with those other employment taxes on Form 941 or Form 943 and on Form 940 (or 940-EZ).

The deduction that can be taken on Schedules C and F (Form 1040) for wages and employment taxes applies only to wages and taxes paid for business and farm employees. You cannot deduct the wages and employment taxes paid for your household employees on your Schedule C or F.

For information about paying taxes through federal income tax withholding and estimated tax payments and figuring the estimated tax penalty, order Publication 505, Tax Withholding and Estimated Tax.

For more information on household employees, order Publication 926, Household Employer's Guide, by calling the IRS at 1-800-829-3676.

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        Employment Taxes For Household Employees

      Florida Unemployment Compensation Tax - Who Must Report Wages

© Copyright 1999 Raymond S. Kulzick. All rights reserved. 990105

This publication provides business, financial planning, and/or tax information to our clients. All material is for general information only and should not be acted upon without seeking appropriate professional assistance.