Do I collect taxes from private care CNA?

Question

I have hired 2 CNA's to care for my elderly parents in their home. Do I need to deduct taxes from their pay? Am I required to pay them overtime?

Answer 1

If the CNAs are your employees (not working for a service as contract workers), then you are required to pay your share of Social Security and Medicare taxes (payroll taxes) on their wages.  The employees share of payroll taxes can be deducted from their wages, or you can choose to pay it yourself and not deduct it from their wages.

To pay the payroll taxes to the IRS, you fill out Schedule H and attach it to your tax return.  The payroll taxes owed are added to your income tax.  You can avoid a large tax bill by increasing your withholding at work, or sending in estimated tax payments.

You are not required to withhold federal income taxes on their wages, unless they request withholding.

Also, your payments to the CNAs can be a medical deduction on your own tax return, even if your parents are not your dependents.

Answer 2

That would depend on the nature of the contract you have with them.  If you are hiring a company that provides CNA services you would not withhold taxes.  If you are hiring two individuals you very likely should withhold employee taxes.

Answer 3

Go read IRS publication 926.

http://www.irs.gov/businesses/small/arti...