What’s a W9?
I’ve been nannying for a family for a few months now. Every week the just write me a personal check and I cash it. No taxes or anything. The other day the mom asked me for my social and address, because she has to submit a W9. She said “it’s like a W2, but I don’t take taxes out” does this mean I’m going to have to pay back taxes for all the money I’ve made with them the past few months?? I’m kind of freaking out here as I make $200-300 a week and am a college kid who does not have thousands of dollars to pay the IRS
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Yes.
They are wanting to treat you like an Independent Contractor and shift some of their tax burden onto you.
The thing is.........Nannies are NEVER Independent Contractors. They are always employees.
https://www.irs.gov/publications/p926
The family is breaking the law.
>>>Under common law, a worker who performs services for you is your employee if you can control what will be done and how it will be done. It does not matter whether you give your nanny great latitude, but rather that you have the right to control the work. It does not matter if the work is performed on a full time or part time basis. It does not matter whether the worker lives with you or not. It does not matter if he/she is paid hourly, daily or a salary. It does not matter how the employee refers to herself or how you refer to him/her in an employment contract. The household worker is your employee and you are generally obligated for all payroll tax filings and remittances.<<<
As no taxes were withheld from your pay, you are going to owe some money one way or another.
Yes you owe tax on the money
You do owe taxes, but it should come to less than $400.
You are required to contribute to Social Security and Medicare. That tax is a fixed 7.65% of your salary.
Your federal income tax rate depends on your total income, but it's 0% on at least the first $6300 you earn in a calendar year. If you don't owe federal tax, then you probably don't owe tax to your state either.
The main issue is going to be that your employer did not pay her share of the Social Security tax. It sounds like she is going to treat you as a self-employed contractor rather than an employee. If you work in her home on her schedule, then she needs to be the one paying employer's taxes.
it is a form very similar to a W-2 but for people who are not employees but are self employed, you pay your own taxes on the money you receive, this for the most part is self employment tax(SS and Medicare)
She wants the W9 so that she can issue you a 1099MISC for your services and make you pay all the taxes. That's not how it's supposed to be done. She is supposed to withhold at least FICA & Medicare from your pay. If she doesn't, she has to "gross up" what she paid you to cover it and reports your earnings and the FICA & Medicare on a W2. She then pays the taxes to the IRS by including a Schedule H with her tax return. You would still be responsible for any income tax on your return. She also may have to file a state payroll return for unemployment taxes. If she issues you a 1099, you will pay self employment taxes of (salary x92.35%) x 15.3% + income tax.
Yep that's what it means...She will give you a 1099 (instead of a W-2) and you will have to pay taxes plus self employment taxes. You should have asked when you realized they weren't taking out taxes. Depending on how much you make .. if you've only worked their a few months it won't be terrible. You have to pay your medicare also, and ss taxes.
If you babysit at YOUR home, she was supposed to give you a W-10 to get your legal name and SSN (she's required to enter these on her tax return when she claims the child care credit).
If you babysit at HER house, download a W-4 from irs.gov and give it to her. She has until 1/31 to issue you a W-2. Since she would have failed to withhold fica/mc taxes, if they apply (and they usually do), she will have to pay those out of her pocket. She then adds the taxes she owes to her 1040 using schedule H for household employee. You don't give your age. (Are you under 18 and a student? If so, this could all be legal, but since you are 20, she's got to pay the tax.)
You can tell her to look at publication 926.
Under NO circumstances would she issue you a 1099-Misc, nor would she need a form W-9.
PS, if you are making $200 a week, that's $10,000 a year. As a college student, if you are under the age of 24, you will owe several hundred dollars in income tax.
It's a "Request for Taxpayer Identification Number and Certification"; and technically, she won't be submitting it to the IRS, but will be using it as a reference for completing Form 1099.
It appears that you're working for her as a self-employed contractor, rather than a direct employee? If you're employed through an agency, then they should already be making the appropriate deductions from your pay. If you're being paid directly, then you should be paying taxes yourself.
If you aren't a self-employed contractor - then you should provide evidence of this (employment contract, pay-stubs etc) to the IRS.