Instructions For Schedule H (Form 1040) - Household Employment Taxes

does not matter if the wages paid are for work done hourly, daily,

Important Dates!

weekly, or by the job.

. . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . .

You must

If a government agency files Schedule H for the worker, you

Note.

do not need to file it.

January 31, 2008

Give your employee Form W-2.

Cash wages.

Cash wages include wages paid by checks, money

February 29, 2008

Send Copy A of Form W-2 with

orders, etc. Cash wages do not include the value of food, lodging,

(March 31, 2008, if

Form W-3 to the Social Security

clothing, or other noncash items you give a household employee.

you file

Administration.

electronically)

For 2007, you can generally give your employee trans-

portation benefits such as transit passes worth up to

April 15, 2008 (see

File Schedule H and pay your

TIP

$110 per month without the benefits counting as cash

page H-3 for

household employment taxes with

wages. However, the value of benefits over $110 a

exceptions)

your 2007 tax return.

month is included as wages. See Transportation (Commuting) Ben-

efits in Pub. 15-B, Employer’s Tax Guide to Fringe Benefits, for

more information.

A calendar quarter is January through March,

Calendar quarter.

The Basics

April through June, July through September, or October through

December.

Reminder

Workers you get from an

Workers who are not your employees.

agency are not your employees if the agency is responsible for who

If you must file a 2007 Form W-2, Wage and Tax Statement, for

does the work and how it is done. Self-employed workers are also

any household employee, you must also send Form W-3, Transmit-

not your employees. A worker is self-employed if only he or she

tal of Wage and Tax Statement, with Copy A of Form(s) W-2 to the

can control how the work is done. A self-employed worker usually

Social Security Administration. You are encouraged to file your

provides his or her own tools and offers services to the general

Forms W-2 and W-3 electronically. Visit the Social Security web-

public in an independent business.

site at to learn about electronic

filing.

Example. You made an agreement with Paul Brown to care for

your lawn. Paul runs a lawn care business and offers his services to

the general public. He hires his own helpers and provides his own

Who Needs To File Schedule H?

tools and supplies. Neither Paul nor his helpers are your employees.

You must file Schedule H (Form 1040) if you answer “Yes” to any

For more information, see Pub. 926, Household Employer’s

of the questions on lines A, B, or C.

Tax Guide.

Only 8 lines for most people.

Depending on your answers, you may

find that you only have to complete lines A, 1 through 4, 6, 8, and 9.

Who Needs To File Form W-2 and

Form W-3?

If you hired someone to do

Did you have a household employee?

household work and you were able to control what work he or she

You must file Form W-2 for each household employee to whom

did and how he or she did it, you had a household employee. This is

you paid $1,500 or more of cash wages in 2007 that are subject to

true even if you gave the employee freedom of action. What matters

social security and Medicare taxes. To find out if the wages are

is that you had the right to control the details of how the work was

subject to these taxes, see the instructions for Schedule H, lines 1

done.

and 3, on page H-4. If the wages are not subject to these taxes but

you withheld federal income tax from the wages of any household

Example. You paid Betty Oak to babysit your child and do light

employee, you must file Form W-2 for that employee.

housework 4 days a week in your home. Betty followed your

specific instructions about household and child care duties. You

If you file one or more Forms W-2, you must also file

provided the household equipment and supplies Betty needed to do

Form W-3.

her work. Betty is your household employee.

Household work is work done in or around your home. Some

Do You Have an Employer

examples of workers who do household work are:

Identification Number (EIN)?

Babysitters

Drivers

Nannies

If you do not have an EIN, see Form SS-4, Application for Em-

Caretakers

Health aides

Private nurses

ployer Identification Number. The instructions explain how you

Cleaning people

Housekeepers

Yard workers

can get an EIN immediately over the internet, by telephone, or in

about 4 weeks if you apply by mail. See How To Get Forms and

If a worker is your employee, it does not matter whether the

Publications on page H-7 for details on how to get forms and

work is full or part-time or that you hired the worker through an

publications including Form SS-4. Do not use a social security

agency or from a list provided by an agency or association. Also, it

number in place of an EIN.

H-2

Instructions For Schedule H (Form 1040) - Household Employment Taxes - 2007 Page 2

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