Friday, April 8, 2011

Household Employer Facts

Our friends at Breedlove & Associates have provided the following information and we are passing it onto you. You'll find their direct contact information within this article so that you can connect with them about any questions you might have.

Most new household employers assume the "nanny tax" obligations will be expensive and tedious. They don't have to be.

As a service to you, we have partnered with Breedlove & Associates, the nation's leader in household payroll and tax compliance services. This family-owned firm specializes in helping busy families eliminate the headaches, hassles and risks of being an employer. And they can show you how to take advantage of tax breaks that can offset (sometimes even exceed) your tax costs.

We strongly recommend that you take advantage of a complimentary, no-obligation phone consultation with Breedlove & Associates. In about 10 minutes, they can assess your situation, run payroll scenarios, help you budget, help you maximize your tax breaks and make sure you avoid expensive labor law mistakes. Simply call 888-273-3356 between 8am - 6pm Central Time and let them know you're working with us.

In the meantime, here's an overview of the key things you need to know.
When you hire a domestic worker (i.e. nanny, nurse, chef, personal assistant, etc.), you are considered a "household employer." Therefore, you're required by law to withhold certain taxes from your employee's pay and remit those taxes -- along with household employment tax returns and employer taxes -- to the state and federal tax agencies each quarter. At the end of the year, you're required to prepare tax documents and distribute them to your employee(s) and to the government by certain deadlines.

Compliance eliminates financial and legal risk for you and your employee. It also provides your employee with many short-term and long-term benefits, such as social security, medicare, unemployment benefits, and the ability to obtain credit/loans.

To better understand your obligations and the Breedlove & Associates no-work, no-worry solution, watch this 3-minute video (

Failure to abide by these laws not only robs your employee of these essential benefits, it exposes your family to significant financial and legal risk. And, it's an unnecessary risk since savings from tax breaks can offset -- sometimes even exceed -- the employer taxes. You may come out ahead by paying legally! For an estimate of your tax costs and your tax breaks, visit our Employer Budget Calculator (


Don't want to deal with all the paperwork? No problem. Breedlove & Associates can handle everything for you with guaranteed accuracy and timeliness. It's easy, affordable and free of work, worry and risk.

If you're thinking about having your accountant handle all your household employment obligations, please be careful and ask a lot of questions; very few tax professionals are experts in this highly-specialized area of the tax world and even fewer provide payroll services or employment law guidance. For these reasons, most people use Breedlove & Associates for their household employment payroll and tax obligations -- as a supplement to their accountant.

For more information about your specific employer obligations and additional detail on how Breedlove & Associates can help, call toll free 888-273-3356 or


If you pay a household employee less than $1,700 (2011) in a calendar year, you are exempt from the tax reporting obligations stated above. This is sometimes referred to as the "Casual Babysitting Exemption," which was enacted in 1995. However, if your temp employee's wages exceed the $1,700 threshold, you are subject to the same compliance requirements as families employing full-time and part-time household workers.

It is important to note that -- regardless of how much you pay your worker or whether she is full-time, part-time or temporary -- you are still legally considered an employer. That means you'll be expected to know and follow federal, state and local household labor law.

For more information about temporary employment, please call 888-273-3356 or

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