HIRING A NANNY LEGALLY: TAX BREAKS FOR NANNY EMPLOYERS
Nanny Los Angeles When it comes to childcare, the household employer tax may seem too expensive for many families. Since the IRS considers nannies as “household employees”, hiring a nanny does bring on significant tax liability. However, before you decide against hiring a nanny, you should know about what vital tax breaks that can, in some cases, counter the initial tax liability. In some cases, this can make hiring a nanny virtually tax-free, and you may end up earning much more tax credit than nanny tax liability! Riveter Consulting Group , one of the most seasoned recruitment agencies in Los Angeles, California, lists down 2 ways that you can receive tax breaks when paying nanny salaries: 1. CREATE A FLEXIBLE SAVINGS ACCOUNT (FSA) Also known as a Dependent Care Account, this fund can be organized with the company that employs you, granted that they participate in the program. Through an FSA, you can set aside up to $5,000 of your earnings before taxes for the purpose ...