The main tax issue is the amount of control you exercise – what is done, and how it is done. The pay frequency is not important (hourly, daily, or weekly), and it makes not difference whether the job is full-time, or part-time.

Example 1: A family hires Victoria, a caregiver, for their elderly mother 4 days a week in their home, for a total of 25 hours. The family gives Victoria instructions about the caring, needs, and other household duties. In addition, the family provides all of the supplies Victoria uses to do her work. Victoria is a household employee.

Example 2: A family hires Lenny to care for their lawn. Lenny works for other homeowners as well, and provides his own tools and supplies. He also hires and pays any helpers he needs. Lenny is considered an independent contractor, not an employee of the family. Lenny is responsible for all employment taxes.

Even if you consider Victoria an ‘independent contractor’ and give her a 1099 form at the end of the year, she is still considered to be YOUR employee.

What taxes and related expenses are involved?

For you, the employer:

Social Security and Medicare: 7.65% of the Gross Federal Unemployment Insurance: up to $56 a year. State Unemployment: up to $349 a year (first year). Worker’s Disability Insurance: About $200 a year. Worker’s Compensation Insurance: About $400 a year.

For your employee:

Social Security and Medicare: 7.65% of the Gross. Federal, State, Local Income Tax (Based on Marital Status and allowances.)

Are there exceptions? (Is this the Government?)

Your Spouse. Children under age 21. Your parent, if: (1) You have a child (under 18) living with you, who has a physical or mental condition that requires the personal care of an adult for at least four continuous weeks in a calendar quarter; and (2) You are divorced (not remarried), or you are a widow/er, or you are married and living with a person whose physical and mental condition prevents him or her from caring for your child for at least four continuous weeks in a calendar quarter. An employee under 18 at any time during the year. For example, a student's "principal occupation" is not providing household services, so you would not have to pay FICA and Social Security taxes for a high school student who is working for you as a babysitter, even if the wages exceeded $1,500.

Tax Implications:

Possible child-care credit, Possible medical deduction, Reduced possibility of vacation at Club-Fed.

For more information:

IRS http://www.irs.gov/publications/p926/index.html NY State http://www.tax.state.ny.us/pdf/publications/multi/pub27_1207.pdf Your tax preparer.

You may contact Joseph Reisman: Tel: 718-332-1040; Fax: 718-743-2721; E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it ; Mail: 2751 Coney Island Avenue, Brooklyn, NY 11235-5004