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Posted by Charles on November 3, 2007, 6:11 pm
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An elderly neighbor of mine wants to hire someone to clean
his apartment twice a month or so and do some light
maintenance jobs from time to time. At what point (salary
threshold) does he need to withhold taxes?
Thank you,
Charles
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Posted by Benjamin Yazersky CPA on November 4, 2007, 7:33 am
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> An elderly neighbor of mine wants to hire someone to clean
> his apartment twice a month or so and do some light
> maintenance jobs from time to time. At what point (salary
> threshold) does he need to withhold taxes?
Check the instructions for schedule H of form 1040.
I think the threshhold level is $1000 or $1500
(all the ones I prepare are above that amount)
But the federal is really the easy part.
Its the state that likely will be more cumbersome.
Each state has different rules applying to household /
domestic employees.
___________________________________
<<< Benjamin Yazersky, CPA [NJ & NY] >>>
-----> real address on hobokeni or hobokenx <-----
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
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Posted by Herb Smith on November 4, 2007, 7:33 am
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> An elderly neighbor of mine wants to hire someone to clean
> his apartment twice a month or so and do some light
> maintenance jobs from time to time. At what point (salary
> threshold) does he need to withhold taxes?
All the rules are contained in IRS Pub 926. The following is
a direct quote from that Pub:
If you and your employee have agreed to withholding, either
of you may end the agreement by letting the other know in
writing.
If you agree to withhold federal income tax, you are
responsible for paying it to the IRS. Pay the tax as
discussed under How Do You Make Tax Payments? on page 7.
Also, see What Forms Must You File? on page 8.
Use the income tax withholding tables in Publication 15
(Circular E), Employer's Tax Guide, to find out how much to
withhold. Figure federal income tax withholding on wages
before you deduct any amounts for other withheld taxes.
Withhold federal income tax from each payment of wages based
on the filing status and exemptions shown on your employee's
Form W-4. Circular E contains detailed instructions >>
NOTE: The above refers only to income tax withholding, not
SS and Medicare taxes, which are covered in the Pub and on
form Schedule H/ 1040.
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by ed on November 4, 2007, 7:33 am
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> An elderly neighbor of mine wants to hire someone to clean
> his apartment twice a month or so and do some light
> maintenance jobs from time to time. At what point (salary
> threshold) does he need to withhold taxes?
Never. Handyman is an independent contractor with no
obligation for you to withhold anything.
ed
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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