Anyone have any experience with this? Any specific payroll systems that you recommend? Those of you with nannies, how do you pay them?
Basics of nanny share, nanny watches a kid from each family, and the two families split the cost of childcare. It works out to be a little more expensive than a daycare, but has more individual attention and fewer kids so hopefully fewer germs. Plus, we alternate homes each week so I cut down on the pick up/drop off from daycare travel.
Our friends want to set this up legally so we can claim tax benefits and avoid potential issues with paying under the table. Since the nanny is not part of a business or service, our current course of action is to set up each family as a separate employer, with our own EINs, and then each of us would hire the nanny at the agreed upon rate. I.e. nanny wants $20/hr, we each hire at $10/hr.
The other family has concerns about the nanny attempting to claim unemployment at some point in the future. If we have a contract and have them set up as an employee, then we would be able to show they were fired with cause and they wouldn’t be able to collect. Or something along those lines, basically they just want to protect themselves and feel that an employee/employer relationship is the best way to do so.
The nanny actually requested that we set up so they could claim the income legitimately. Currently they have no way of proving any income other than the money existing in their bank account from their current nanny gig. The nanny claims to have been having difficulty getting approved for car loans, apartments, etc. They are actually agreeing to take less money after taxes in order to show they are actually employed; currently the nanny is mid-20s and other than references has no way to show employment history. As far as I’m concerned, the only extra expense so far is the $45/mo to a payroll company to handle the W-2 and other annual forms and weekly checks.
Part of me wonders if I can convince the nanny to set up their own LLC, and then the LLC bills the nannying as a service, then I don’t have to do any work on my end. But if we ever had to change nannies, we’d be back to square one.
We hired a nanny (not a share) and paid above the table. There was a ton of record keeping. In addition to wages, we paid withholding to the IRS, unemployment insurance, SS, and while it wasn’t required, we decided we also wanted to pay WC.
We kept track of hours worked, wages paid, and all the other stuff. We did it on a piece of paper, which she and my husband initialed. I wonder if there might be software for that today.
I think you want to set it up as a single employment you are jointly paying for. If she doesn’t want to create an LLC, maybe one of you can?
When Canadian covid benefits rolled out, it was based on income. A lot of smarty pants who were earning income under the table had no provable income and thus didn’t Get covid benefits. And the benefits were pretty decent. Sick burn I guess.
