State household employment tax returns for the first quarter are due on April 30.  So, if you paid a household employee during the Jan/Feb/March timeframe, you'll need to get your paperwork in order to make sure you avoid late penalties and interest charges. 

If you're a Breedlove client, no worries.  You're all taken care of.

If you're not a Breedlove client and would like someone to handle all the "nanny tax" work and worries for you, just click BECOME A CLIENT in the top right-hand corner.  Once we get your information, we can have you set up by the next business day.

Just got a call from a family in Minnesota who made a mistake everyone should learn from.

In an effort to simplify their life, they put their nanny on their company payroll and company benefits plan.  A large health insurance claim was denied by the insurance company on the grounds that she is not an employee of the company.

In addition, the company had taken illegal deductions on her payroll expense since the IRS does not view her as a direct contributor to the success of the business.  The family had to amend business and personal tax returns for the last 2 years. 

Instead of taking business tax deductions, the family should have handled her payroll through their personal funds, filed household employment tax returns, and taken a personal tax deduction on those childcare expenses.

If you have any questions about how to avoid this mistake, please give us a call.