The tax filing deadline has a way of sneaking up on us every year. As a household employee, you’re responsible for filing a federal income tax return and, if your state requires it, a state tax return. So if you’re the type of person that procrastinates and you suddenly realize you don’t have your paperwork in order, you may be scrambling and wondering what to do.
“The IRS expects some form of contact from you every April, preferably in the form of an accurate tax return,” says Tom Breedlove, Sr. Director of Care.com HomePay. “This way, they’ll know if they owe you a refund or if you need to account for some additional tax liability.”
Even though it may be late in the game, don’t worry. Here’s what you need to do:
1. Get a W-2 from your employer
If you earned $2,400 or more from any family you worked for last year, you should have received a copy of your Form W-2 by January 31. If your employer hasn’t given you one yet, ask for it now and say you need it to file your personal income tax returns.
If the family was paying you under the table last year, let them know it’s not too late to go back and account for their household employment tax responsibilities. Show them this article detailing the steps they need to take and let them know they can contact Care.com HomePay for help. If the family unfortunately isn’t interested in complying with their tax responsibilities, you should still protect yourself from charges of tax evasion by reporting your income.
In the absence of a W-2, you can file a Form 4852, which the IRS will accept. You have to report all the wages you earned and pay the income taxes that were never withheld. “Filing a Form 4852 should really be your last resort because it doesn’t solve your employer’s non-compliance issue and can cause them to be audited,” says Breedlove.
Read more tips about what to do if your employer won’t pay taxes.
2. Ask for a filing extension if you need more time
If it’s close to the April 18 deadline and you know you won’t be ready to file your personal income tax return, filing for an extension is better than not filing at all. If you don’t do anything, you could be assessed a late penalty fee when you do eventually file. “Your goal is to be in compliance with IRS regulations to avoid any problems,” says Michael Salazar, a board member of the Accreditation Council for Accountancy and Taxation.
To ask for an extension, file Form 4868, which tells the IRS that you intend to file a tax return by October 15. The form also asks you to pay the estimated taxes you believe you’ll own right away.
3. Ask for a payment extension if you can’t cover the full tax payment
Do you owe taxes and money is tight? Unfortunately, the IRS never looks kindly on not getting their money in a timely manner. However, you can apply for a payment plan with the IRS asking for an extension for paying any taxes owed. There’s no guarantee that the IRS will accept your application, but it shows a good-faith effort instead of short-changing the taxes you owe on your Form 4868.
4. Plan ahead for next year’s tax season
If you barely made the tax filing deadline this year or had to file for an extension, let that experience give you even more incentive to be on top of everything next year. Start a file for anything that will be related to your taxes and set a reminder to ask your employer about the status of your W-2 by the middle of January.
No one likes to spend a lot of time worrying about taxes, so if your employer seems to be having difficulty managing the financial side of your employment, tell them to contact Care.com HomePay. Our service handles taxes, payroll and HR-support for families with in-home caregivers and can ensure your tax forms will be accurate and delivered to you on time each tax season.
Your Next Steps:
* The information contained in this article is general in nature, may not be applicable to your specific circumstances, and is not intended to be a substitute for or relied upon as personalized tax or legal advice.