My situation is thus. There are periods of my past employment where I worked under the table (for family construction business and also while doing part-time child care). I didn't pay income taxes or file returns for those years. Currently I'm applying for a government job that takes issue with such behavior, so I intend to file returns for those past years as well as pay the owed income tax. =====Then, you need to pay both penalties and interest on your past due tax returns. Not only you but even your employer also need to pay all past due social sec taxes on your w2 income and also need to pay all past due penalties/interest. skirting employment taxes can be even more serious than skirting income taxes. you'll need to hire an accountant , an EA a CPA doing taxes in your local area to help you set up an appropriate tax arrangement
What I'm hoping to get some advice on is which forms I would need to submit to file for these past years. =====
.Correct; you need to file past due tax returns . Cash still has to be reported as income, and you still have to keep records.
Receiving cash doesn?t mean you are not an employees or you are not automatically independent contractor either.
Since I don't have W2 forms from my employers for those periods, would I need to file a 4852 W2 Substitute form? =====>>no;
? Form 4852 serves as a substitute for Forms W-2 or 1099R NOT for cash payements; your cash income is not reported on a W-2, it needs to be entered separately on tax forms. You need to keep careful records of your cash income. In the event that the IRS audits your cash income, it will look at bank account deposits, so make sure your calculated cash income is close to those deposits. You also need to total all of your cash income received for the years. You do not need to include any work which you have done in the fiscal year but for which you have not received payment. You need to complete your Federal 1040 form. Line 21 on the 1040 tax form is for "other income." List the source of your income on the dotted line and the amount in the box. Also fill out your state /local income returns. Though the exact location of the entry will vary from state to state, you will need to also enter in your cash income information .The you should file your past due taxes as you normally would
If I do file those forms, would the families that I provided childcare for receive a penalty?
=====>I guess it depends; If they have a nanny or frequent babysitter for their children, they need to understand the nanny tax. The IRS requires anyone with household help, such as a babysitter or housekeeper, to pay Social Security and Medicare taxes if annual pay crosses a set threshold, which was $1,600 for 2008 and $1,700 for 2009, 2010 and 2011 and $1,900 for 2014. If not they need to pay penalties/interest on the payments to you on their returns.