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taxmap/instr/i1040sh-000.htm#en_us_publink1000274719

2013 Instructions for Schedule H (Form 1040)
Household Employment Taxes

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Household
Employers(p1)

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2013

taxmap/instr/i1040sh-000.htm#en_us_publink21451xd0e38Introduction

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Here is a list of forms you need to complete:(p1)

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For more information, see What Forms Must You File? in Pub. 926, Household Employer's Tax Guide.
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No household employees in 2013?(p1)
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If you did not have any household employees in 2013, you do not have to file Schedule H (Form 1040) for 2013.
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We have been asked:(p1)

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What do I do after I fill in Schedule H?(p1)
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If you must file a 2013 tax return, enter the taxes from Schedule H on the Household employment taxes line of your Form 1040, 1040NR, 1040-SS, or 1041. You do this because these taxes are added to your income taxes.
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How do I file Schedule H?(p1)
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File Schedule H with your Form 1040, 1040NR, 1040-SS, or 1041. If you are not filing a 2013 tax return, file Schedule H by itself.
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Do I make a separate payment?(p1)
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No. You pay both income and employment taxes to the United States Treasury when you file Schedule H with your return.
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When do I pay?(p1)
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Most filers must pay by April 15, 2014.
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How many copies of Form W-3 do I send to the SSA?(p1)
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Send one copy of Form W-3 with Copy A of Form(s) W-2 to the SSA, and keep one copy of Form W-3 for your records. Instructions for filing Forms W-2 and Form W-3 electronically are available at www.socialsecurity.gov/employer.
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Important Dates!(p1)

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ByYou must
January 31, 2014Give your employee Form W-2.
February 28, 2014 (March 31, 2014 if you file electronically)Send Copy A of Form(s) W-2 with Form W-3 to the SSA. Visit www.socialsecurity.gov/employer for details.
April 15, 2014File Schedule H and pay your household employment taxes with your 2013 tax return.
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Future Developments(p2)

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For the latest information about developments related to Schedule H (Form 1040) and its instructions, such as legislation enacted after they were published, go to www.irs.gov/form1040.
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What's New(p2)

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Changes to tax rates and wage threshold.(p2)
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The employee tax rate for social security is 6.2%. Previously, the employee tax rate for social security was 4.2%. The employer tax rate for social security remains unchanged at 6.2%. The social security wage base limit is $113,700. The Medicare tax rate is 1.45% each for the employee and employer, unchanged from 2012. There is no wage base limit for Medicare tax. Social security and Medicare taxes apply to the wages of household workers you pay $1,800 or more in cash or an equivalent form of compensation in 2013.
For information about the rates and wage threshold that will apply in 2014, see Pub. 926 (released in December 2013).
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Additional Medicare Tax withholding. (p2)
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In addition to withholding Medicare tax at 1.45%, you must withhold a 0.9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year. You are required to begin withholding Additional Medicare Tax in the pay period in which you pay wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. Additional Medicare Tax is only imposed on the employee. There is no employer share of Additional Medicare Tax. All wages that are subject to Medicare tax are subject to Additional Medicare Tax withholding if paid in excess of the $200,000 withholding threshold.
For more information on Additional Medicare Tax, visit IRS.gov and enter Additional Medicare Tax in the search box.
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Credit reduction state.(p2)
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A state that has not repaid money it borrowed from the federal government to pay unemployment benefits is a credit reduction state. The Department of Labor determines these states. If an employer pays wages that are subject to the unemployment tax laws of a credit reduction state, that employer must pay additional federal unemployment tax.
For 2013, there are credit reduction states. If you paid wages that were subject to the unemployment compensation laws of a credit reduction state, your credit against federal unemployment tax will be reduced based on the credit reduction rate (i.e., .003, .006, .009 or .015) for that credit reduction state.
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Reminders(p2)

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Outsourcing payroll duties.(p2)
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Employers are responsible to ensure that tax returns are filed and deposits and payments are made, even if the employer contracts with a third party to perform these acts. The employer remains responsible if the third party fails to perform any required action. If you choose to outsource any of your payroll and related tax duties (that is, withholding, reporting, and paying over social security, Medicare, FUTA, and income taxes) to a third-party payroll service provider, visit IRS.gov and enter outsourcing payroll duties in the search box for helpful information on this topic.
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Paid preparers are required to sign Schedule H. (p2)
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Your paid preparer must sign Schedule H in Part IV unless you are attaching Schedule H to Form 1040, 1040NR, 1040-SS, or Form 1041. A paid preparer must sign Schedule H and provide the information requested in the Paid Preparer Use Only section only if the preparer was paid to prepare Schedule H and is not your employee. The preparer must give you a copy of the return in addition to the copy to be filed with the IRS.
If you are required to file a 2013 Form W-2 for any household employee, you must also send Form W-3 with Copy A of Form(s) W-2 to the SSA. You are encouraged to file your Forms W-2 and W-3 electronically. Visit the SSA's Employer W-2 Filing Instructions & Information website at www.socialsecurity.gov/employer to learn about electronic filing.
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Who Needs To File Schedule H?(p2)

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You must file Schedule H if you answer Yes to any of the questions on lines A, B, or C of Schedule H.
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Did you have a household employee?(p2)
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If you hired someone to do household work and you could control what work he or she did and how he or she did it, you had a household employee. This is true even if you gave the employee freedom of action. What matters is that you had the right to control the details of how the work was done.

Example.(p2)

You paid Betty Oak to babysit your child and do light housework 4 days a week in your home. Betty followed your specific instructions about household and child care duties. You provided the household equipment and supplies Betty needed to do her work. Betty is your household employee.
Household work is work done in or around your home. Some examples of workers who do household work are:
BabysittersDriversNannies
CaretakersHealth aidesPrivate nurses
Cleaning peopleHousekeepersYard workers
If a worker is your employee, it does not matter whether the work is full or part-time or that you hired the worker through an agency or from a list provided by an agency or association. Also, it does not matter if the wages paid are for work done hourly, daily, weekly, or by the job.
If you are a home care service recipient receiving home care services through a program administered by a federal, State, or local government agency, and the person who provides your care is your household employee, you can ask the IRS to authorize an agent under section 3504 to report, file, and pay all federal employment taxes, including FUTA taxes, on your behalf. See Form 2678, Employer/Payer Appointment of Agent, for more information.
Note.(p3) If a government agency or third party agent reports and pays the employment taxes on wages paid to your household employee on your behalf, you do not need to file Schedule H to report those taxes.

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Workers who are not your employees.(p3)
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Workers you get from an agency are not your employees if the agency is responsible for who does the work and how it is done. Self-employed workers are also not your employees. A worker is self-employed if only he or she can control how the work is done. A self-employed worker usually provides his or her own tools and offers services to the general public in an independent business.

Example.(p3)

You made an agreement with Paul Brown to care for your lawn. Paul runs a lawn care business and offers his services to the general public. He hires his own helpers, instructs them how to do their jobs, and provides his own tools and supplies. Neither Paul nor his helpers are your employees.
For more information, see Pub. 926.
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Who Needs To File Form W-2 and Form W-3?(p3)

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You must file Form W-2 for each household employee to whom you paid $1,800 or more of cash wages in 2013 that are subject to social security and Medicare taxes. To find out if the wages are subject to these taxes, see the instructions for Schedule H, lines 1, 3, and 5. Even if the wages are not subject to these taxes, if you withheld federal income tax from the wages of any household employee, you must file Form W-2 for that employee.
If you file one or more Forms W-2, you must also file Form W-3.
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Do You Have an Employer Identification Number (EIN)?(p3)

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If you have household employees, you will need an EIN to file Schedule H. If you do not have an EIN, see Form SS-4, Application for Employer Identification Number. Do not use a social security number in place of an EIN. The Instructions for Form SS-4 explain how you can get an EIN immediately over the internet or by telephone, in 4 business days by fax, or in about 4 weeks if you apply by mail. See How To Get Forms and Publications for details on how to get forms and publications including Form SS-4.To get an EIN over the internet, visit IRS.gov and click on the Apply for an EIN Online link under Tools.
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Can Your Employee Legally Work in the United States?(p3)

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It is unlawful to employ a person who cannot legally work in the United States. When you hire a household employee to work for you on a regular basis, you and the employee must each complete part of the U.S. Citizenship and Immigration Services (USCIS) Form I-9, Employment Eligibility Verification. You must verify that the employee is either a U.S. citizen or a person who can legally work in the United States and you must keep Form I-9 for your records. You can get the form and the USCIS Handbook for Employers by calling 1-800-870-3676, or by visiting the USCIS website at www.uscis.gov.
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What About State Employment Taxes?(p3)

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If you employed a household employee in 2013, you probably have to pay contributions to your state unemployment fund for 2013. To find out if you do, contact your state unemployment tax agency. For a list of state unemployment tax agencies, visit the U.S. Department of Labor's website at www.workforcesecurity.doleta.gov/unemploy/agencies.asp. You should also find out if you need to pay or collect other state employment taxes or carry workers' compensation insurance.