| Every spring we receive inquiries from nannies who did not receive a Form W-2
from their employer. This is almost always when the nanny is no longer employed
by the family. The following are some tips and steps to take. Form W-2 is due January 31.
The IRS specifically asks that you allow the employer
until February 15 before you report it missing. The January 31 date is the 'mail
by' date.
It is February 15 and you still do not have a W-2.
First step is to phone the
employer. Often the nanny has moved and the employer does not have a valid
mailing address. Allow two additional weeks if you needed to update your address
for
the employer to obtain/generate a replacement.
The employer does not intend
to give you a W-2 or intends to provide a 1099.
The next step is to remind
the employer that as a nanny you are entitled to
a Form W-2. The employer is responsible to remit the Social Security and
Medicare taxes, as well as pay unemployment insurance. The employer is NOT responsible
for the nanny's income taxes unless it was agreed to in the written work
agreement
(rather rare). The IRS Publication 926 is a point of reference to reinforce
this.
Phone Support from the IRS.
The IRS encourages employees in
this situation to phone 1-800-829-1040 for guidance. In our experience, you will
be told
the same
information as what is contained here, and wait on hold a VERY long time
to get this information!
The employer still refuses to provide the W-2
Form.
The nanny is still responsible for reporting her nanny wages
and filing an income tax return.
This is accomplished
by completing Form 4852 Substitute Form W-2.
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Tip!
Be very sure that 7(A)(a) is the sum of the gross wages plus the
values for Social Security and Medicare Taxes due from the employer.
For example:
Nanny is paid $2000 per month for 8 months. 7(A)(a) is $17224.00 ($16000
+ $1224) The
Social Security and Medicare is 7.65% of the gross wages. 7(A)(b) is
$16000.
Nannies who use the Form 4852 will need to provide the family's name
(both John and Mary Smith), their address and phone number (phone is
not requested
but very
helpful). If the nanny has received a Form W-2 from this family in
the past, the nanny should report the EIN from the prior form. If not,
enter Unavailable or Unknown.
The answer to line 8 of Form 4852 is that 7(A)(a) is the sum of cash wages and
employee Social Security and Medicare paid by employer. 7(A)(b) is cash wages
alone.
The answer to line 9 is a brief statement - something to the effect "I
worked as a nanny from x date to y date. I was paid at RATE. I phoned the family
and requested the Form W-2 and they refused to provide." or a similar BRIEF
narrative. It is important that you state you were a nanny.
The nanny cannot eFile when using a substitute Form W-2. The conventional paper
tax return is mailed to the appropriate address.
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