Originally Posted by vem_oakland
#1;Hello! I live in California and am expecting soon. I would like to hire my mother as my nanny. She is happy to do this and I'm planning on paying her $200 a week just for spending money. If I understand the law correctly, I do not need to do payroll for federal taxes. Is this true?
#2;What about state taxes? Thanks so much for your help!!
#1; you hire your mother a yur nanny , then she is exempt from FICA tax withholding.This makes the whole hiring your parent thing a lot easier. However,Your mother cares for your child who is under 18 or is disabled and and You are either divorced or widowed and not remarried, or your spouse is permanently disabled. So, if you meet these conditions above, then you do pay the fica taxes. Otherwise, you just pay your mom every week. She can report the income on her 1040 and you can report that you paid her and claim the child care credit. You do not pay FUTA on your mother no matter what the circumstance.aslongas she requests you to w/h her fed tax, then you need to w/h her fed tax. If she cares for the child at her home she would be an independent contractor filing 1099.
You will need to provide your mother with a W2 after the year is over showing the income paid, whether you withhold the fica taxes or not.
#2;I gues it depends. You may be required to pay state unemployment insurance,UI tax, you’ll have to check with your state.