If you are e-filing your return, you will need to fill out Schedule H in TurboTax so that it is transmitted with your return. If you are going to mail in your return, just include the paper copy of Schedule H prepared by the payroll company.
Schedule H will calculate the Household Employment Taxes you owe, but you also need to enter the tax payments you paid under "estimated taxes."
To prepare a Schedule H in TurboTax, please follow these steps:
- Type "nanny tax" in the Search box (upper right of program) and click the 'Jump to' link
- Answer Yes to Did You Have a Nanny or Household Employee and follow the TurboTax interview
To Enter tax payments, follow these steps:
Federal withholding is reported in the process of preparing Schedule H. To report any Federal/state/local tax payments you made, please follow these steps:
- After you finish entering your information in the Nanny and Household Employee Tax section,
- In the Search box (upper right of program) search "estimates paid" and select the "Jump to" link from results
- On the next screen, click on the Start/Revisit box next to Federal/State [or Local] estimated taxes for 2016.
- Enter your payment(s) on the next screen, How much did you pay in Federal/State [or Local] estimated taxes?
NOTE: If you filed a 940/941 and paid the tax, you do not file a schedule H at all. See IRS Pub 926 page 11: https://www.irs.gov/pub/irs-pdf/p926.pdf Business employment tax returns. Don't use Schedule H if you choose to pay the employment taxes for your household employee with business or farm employment taxes. Instead, include the Social Security, Medicare, and withheld federal income taxes for the employee on the Form 941 or Form 944 you file for your business or on the Form 943 you file for your farm. Include the FUTA tax for the employee on your Form 940.