I am so tired

Joydean

You can also ask what they charge for say 4 hour shift. They are independent contractor, self-employed and all you have to give them is a 1099 at end of year. They tell you what they charge.  Those are easy to fill out. They are not always household employees. They are only there to care for the patient. Just an idea.

​fesk

Joydean, I have heard of people handing it that way but I don't know the particular circumstances. 

An accountant should be able to advise and this page has info:

https://www.irs.gov/publications/p926

May flowers

I think, from what I’ve read, she has to be considered an employee if she is paid over $2,400. She is in our home, using our equipment and supplies, and we set the hours. Anyway, a little glitch (hopefully not that other shoe I was waiting to fall), is she wants to be paid in cash which would require a 1099.

This will not be an issue for the first few paychecks, but we plan to sit down with her and suggest that we hire her as an employee - it is safer for her and us. This is the assumption that she works and out we want her to stay. Anyway, we may even to sweeten the deal by upping the pay so that her take home after taxes will be the same as she asked to be paid in cash.

​fesk

I'm not surprised she asked for cash. Everyone I have spoken to has. I had one person who wouldn't accept a check written to cash and wanted cash out of an ATM. 

Did she agree to a 1099? Wouldn't that mean the money was reportable which is what she is trying to avoid?

If you end up paying cash and going the 1099 route, please either post or message on how that is handled. I'd appreciate the info. And, could a 1099 be done in the long run? 

If taxes are taken out, I do think it's reasonable to up the pay somewhat so it is closer to what she would earn if paid in cash (not exactly equal). There are more taxes/expenses on the employer side when handling through payroll which I don't think the caregivers are aware of or understand. Explaining that may help when discussing salary.

I think paying cash is going to be a constant request that will need to be considered (with or without a 1099). The agencies do not have anyone of quality or who are reliable these days; there is a shortage of quality caregivers even when hiring privately; and, when you finally find one, do you let them go because they will only accept cash?

May flowers

Here is a pretty good guide: https://www.care.com/hp/nanny-tax-guide

I have about 3.5 weeks to get this worked out as we will meet the threshold at that point. I told DH he needs to be in charge of working all this out with her. It’s his dad, he has DPOA and is on my FIL’s account so it makes sense. 

​fesk

Thanks for the link. I'll check it out.

Best of luck this week with the new caregiver. I'm really hoping it works out. Keep us posted.