Hi,
Until recently, I did not know of a nanny tax procedure to be followed: https://www.care.com/hp/how-to-pay-n[product key removed]elf
For the year 2022, we paid $3k to a nanny and also got some homeoffice help done. For the simplicity, let's say we only got the nanny work done. We knew about reporting to the IRS using 1099-NEC for larger than $600 amounts so we reported the $3k as 1099-NEC. A few days ago, I learned about nanny tax (link above).
1. Now I want to know what procedure I should follow so I inform the IRS that we are going to do it the right way for the last year so they should use the W2 I will provide and ignore the 1099-NEC? I am guessing that many must be doing an honest mistake like mine and must have a recourse to correct it... We understand that we will have to pay 1040-ES each quarter; but we pay those separately for our Schedule C income anyway for the home office. So, I am not too worried about that; unless I am missing something...
2. Also, is this something that I am sweating about unnecessarily? Someone suggested to move to W2 going forward; however, I wonder when year 2022 shows 1099-NEC and the year 2023 shows W2 to the same person, wouldn't that raise a flag?
Thanks!
