Publication 926 - Household Employer'S Tax Guide

contact the INS Office of Business Liaison at

pay state unemployment tax for your household employee.

1 –800 – 357 – 2099.

For the address and phone number, see the Appendix,

near the end of the publication. You should also find out

whether you need to pay or collect other state employment

You also can visit the INS web site at

taxes or carry workers’ compensation insurance.

to get Form I – 9.

Social Security and Medicare Taxes

The social security tax pays for old-age, survivors, and

disability benefits for workers and their families. The Medi-

care tax pays for hospital insurance.

Do You Need To Pay

Both you and your household employee may owe social

security and Medicare taxes. Your share is 7.65% (6.2%

Employment Taxes?

for social security tax and 1.45% for Medicare tax) of the

employee’s social security and Medicare wages. Your

If you have a household employee, you may need to

employee’s share is the same.

withhold and pay social security and Medicare taxes, pay

You can use Table 3 (shown near the end of this

federal unemployment tax, or both. To find out, read Table

TIP

publication) to figure the amount of social security

and Medicare taxes to withhold from each wage

You do not need to withhold federal income tax from

payment.

your household employee’s wages. But if your employee

asks you to withhold it, you can. See Do You Need To

Withhold Federal Income Tax, later.

You are responsible for payment of your employee’s

If you need to pay social security, Medicare, or federal

share of the taxes as well as your own. You can either

unemployment tax or choose to withhold federal income

withhold your employee’s share from the employee’s

tax, read Table 2 for an overview of what you may need to

wages or pay it from your own funds. If you decide to pay

do.

the employee’s share from your own funds, see Not with-

holding the employee’s share, later. Pay the taxes as

If you do not need to pay social security, Medi-

discussed under How Do You Make Tax Payments, later.

TIP

care, or federal unemployment tax and do not

Also, see What Forms Must You File, later.

choose to withhold federal income tax, read State

employment taxes, next. The rest of this publication does

Social security and Medicare wages. You figure social

not apply to you.

security and Medicare taxes on the social security and

Medicare wages you pay your employee.

If you pay your household employee cash wages of

State employment taxes. You should contact your state

$1,400 or more in 2003, all cash wages you pay to that

unemployment tax agency to find out whether you need to

employee in 2003 (regardless of when the wages were

Table 1. Do You Need To Pay Employment Taxes?

IF you ...

THEN you need to ...

A–

Pay cash wages of $1,400 or more in 2003 to any one Withhold and pay social security and Medicare taxes

household employee.

Do not count wages you pay to —

•

Your spouse,

The taxes are 15.3% of cash wages.

•

Your child age 20 or younger,

Your employee’s share is 7.65%.

•

(You can choose to pay it yourself and not

Your parent (see page 4 for an exception), or

•

withhold it.)

Any employee age 17 or younger at any time in

•

Your share is a matching 7.65%.

2003 (see page 4 for an exception).

B–

Pay total cash wages of $1,000 or more in any

Pay federal unemployment tax

calendar quarter of 2002 or 2003 to household

employees.

Do not count wages you pay to —

•

Your spouse,

The tax is usually 0.8% of cash wages.

•

Your child age 20 or younger, or

Wages over $7,000 a year per employee are not

•

taxed.

Your parent.

•

You also may owe state unemployment tax.

Note: If neither A nor B above applies, you do not need to pay any federal employment taxes. But you may still need to pay state

employment taxes.

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Publication 926 - Household Employer'S Tax Guide - 2003 Page 3

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