Household Employees

Employers are NOT required to withhold federal income tax on wages paid to household employees.

Household employees include, but are not limited to, housekeepers, maids, nannies, baby-sitters, private nurses, gardeners and any similar domestic worker. The work is performed in and around the employer's private home.

If the taxpayer says they are a household employee and this is the taxpayer's only source of wages, suggest that the taxpayer talk to their employer about voluntary withholding, or offer to send the taxpayer Form 1040-ES Estimated Tax for Individuals.

If lock-in letters have already been issued and you determine that the taxpayer is a household employee

Issue Letter 2809C to the employer and Letter 2813C to the taxpayer to release the lock-in.

Input TC 972 AC 146 with Disposition Code "NSW" .

Document the history and close the case.

If the household employment is not the only source of wages, subtract the household wages from the total wages and take the following actions:

Compute the withholding rate based on the lesser amount of wages

Issue either a 2800C and 2801C , or 2808C and 2812C , as appropriate

Input the appropriate TC 97X AC 14X

Document the history and close the case

If lock-in letters have not been issued, document the history and close the case.

Follow general lock-in procedures if you determine that the taxpayer is not a household employee.