Exploring Employer Tax Obligations for Caregivers

Feb 20, 2017

Exploring Employer Tax Obligations for Caregivers

Share Article

If you are a private caregiver, one of the most stressful points in your job may be tax season. It is incredibly important that you understand employer tax obligations for caregivers. The IRS says that, generally, the person giving direction to the caregiver or that is receiving care – or their spouse- is the employer.

Caregivers that work through an agency don’t have to worry about some of the tax items that private caregivers need to. When you senior is your employer, tax season can get tricky, especially if the senior is not well or do not understand their obligations.

Below we’ve outlined some helpful tax tips for caregivers. Please note that while our tips are meant to help caregivers, we recommend that all caregivers speak with a tax accountant in order to ensure that they are filling out their taxes correctly.

Exploring Employer Tax Obligations for Caregivers

Once you have been paid $2,000 or more during a year, your employer must meet some household employer tax obligations for caregivers. It is incredibly important you know these tips and tax rules for caregivers so that you can take advantage of tax breaks.

If you don’t work for an agency that is going to make sure you have all the tax information you need, you may be lost when tax season hits.

Household Employer Tax ID

You will get a Federal Employer Identification Number (EIN) from the IRS. Your sate ID number will come from your state’s tax agency. You will need these numbers when you file your tax returns.

Calculate and Withhold Taxes

You’ll need to withhold Medicare and Social Security, or FICA, from your pay each pay period. Though not required, you should also withhold federal and state income taxes, that way you won’t have a large tax bill at the end of the year.

Your employer, which is your senior or their spouse, will also need to track their taxes they withhold each pay period. They also will need to withhold for federal and state unemployment insurance taxes. Depending on what state they are in, there could be additional taxes that may need to be accounted for.

File Federal Estimated Tax Payments

Each quarter, your employer should file federal estimated tax payments using IRS Form 1040-ES. As a household employer, your senior has an obligation to send the IRS the federal income taxes withheld from you, their FICA taxes owed, and federal unemployment insurance taxes.

State Employment Tax Returns

Each quarter, you employer should files state tax returns to send the state the income taxes withheld from you, and the unemployment taxes they owe.

Prepare and Distribute a W-2 To Caregiver

On of the employer tax obligations for caregivers that most of us are aware of is that they are responsible for preparing and giving you a W-2 form so you can file your taxes for the year.

Filing with Social Security

Your employer must file Form W-3, and Form W-2 Copy A with Social Security. They may have to also file an annual reconciliation form with the state, which will include all of their tax activity for the year.

File Personal Tax Returns

Your employer still has an obligation to file his or her own taxes, however, they will need to use the Schedule H Form. If this is your senior’s first year as a household employer, make sure they know there is specific form they need to use to file their own taxes.

Do not assume that your senior understand their tax obligations to you. When you take the time to understand employer tax obligations for caregivers, you give yo

Please enter a comment.
Please enter a name.
Please enter a valid email address in the form "name@domain.com".
Please check the box to the left of "I'm not a robot".

Frequently Asked Questions

How does osteoarthritis impact daily life?

Depending on the severity of the condition, osteoarthritis affects people differently. Most of the time the wearing of joints occurs very gradually over the course of many years. Mild cases are relatively able to be managed and constitute only a minor nuisance while living day-to-day.

More severe cases can limit mobility or the willingness to participate in daily activities due to the pain and discomfort resulting from osteoarthritis. This condition can make it hard to complete tasks involved with self-care, often discouraging people from working to treat osteoarthritis with healthy exercise.

See All Answers »

I was just told that my Dad is getting kicked out of assisted living. Is that possible?

Unfortunately, yes. Though it sounds awful, seniors can sometimes get kicked out of assisted living communities. Some of the reasons senior get kicked out are: endangering the health and safety of other residents or workers, breaking the rules, not paying the bill, or needing more healthcare than the community provides. However, most communities will provide residents with at least 30 days’ notice of eviction to allow families to plan around the situation. 

See All Answers »

Search By State

Find Senior Caring Options by State
Finding the perfect senior care community is only part of making your loved one’s senior living transition smooth. At SeniorCaring, we know that it is also equally important to be aware of what other community services and resources are available to your family’s senior. Choose your location and find local resources for your senior.