How to File Household Employee Taxes

Instructions

1

Keep a record of wages paid to household employees and the amounts withheld for social security and Medicare taxes. You are not required to withhold Federal income taxes unless your employee requests that you withhold and you agree to do it.
2

Exclude from employment tax withholding any wages paid to your spouse, your parent, your child under age 21, or an employee who is under age 18 at any time during the year unless doing housework is the employee's principal occupation. If the employee is also a student, doing housework is not considered to be a principal occupation.
3

Give your household employee a Wage and Tax Statement Form W-2 after year end and also submit the form to the IRS. If you are liable for unemployment taxes for the employee, you will have to file Form 940 Annual Federal Unemployment Tax Return.
4

Access and complete Schedule H Household Employment Taxes from the IRS website.
5

File Schedule H for household employment taxes with your Form 1040 tax return for the year.