Originally Posted by
Analise
Isn't this "legit"?
There can be severe penalties for wrongly classifying someone as an independent contractor when the government believes he or she is an employee.
Originally Posted by
magiciansampras
Um, I'll well aware of the law. Please read my OP. We will be doing this above board. The question relates to whether it is standard to gross up in order to pay all taxes for the employee, not whether it is advisable to not report the nanny and her income.
Uh, you're welcome. But since you know the law, here's a question for you. Prospective nanny says to you, e.g., I want $400 a week. You say you're willing to pay $400 a week but the nanny then specifies, "I want it in cash." You then suggest you will, as you put it, "gross up" her wages so that
after taxes it comes to $400 a week. Question: Are you,
in reality, paying her taxes? If so, is the money you are paying above the original $400
taxable income to her?
Originally Posted by
themicah
By your wink I assume you're kidding, but just in case... no, it's not. Employers of household employees like nannies are subject to special tax and insurance rules and regulations that you can't skirt by just calling them an independent contractor.
Absolutely correct!
Originally Posted by
themicah
And Landing Gear, I'm not saying (or hinting) that it's okay to skirt the legal requirements. I'm saying that for many families and nannies, the reality is that compliance would make it extremely difficult for the families to pay a wage that was acceptable to the workers. In some of those cases, both parties decide they'd rather assume the legal and financial risks of noncompliance.
Boo hoo! Charge all of them and throw in an extra one for Conspiracy.
Originally Posted by
themicah
The fact that so many people pay their domestic help off the books (and the numbers I've seen are quite staggering) suggests to me that there is a fundamental problem with how some of these rules are set up. It needs to be easier to comply in the first place and easier to get into compliance for those who didn't start out that way.
Law school is over, amigo. You are arguing "policy" which will get you nowhere and these people, hopefully in jail. The same bogus "arguments" are made to justify noncompliance with immigration laws.
Originally Posted by
Analise
I was kidding. Nannies get so exploited especially here in NYC by wealthy parents who would just as soon NOT spend time raising their kids while having the nannies act as their personal maids too.
That's true in many cases, I am sure. But what can be done? I do know that the federal government did tighten a lot of the requirements for au pairs who really were getting exploited.