Since your mom was not in your home for all of the childcare she provided, you do not have to call her a "household employee" for the amount she earned. She simply has self-employment income for which you do not issue any sort of document. She must report the self-employment income on her own return. If she was taking care of the children so you could work, then you will enter the amount you paid her when you seek the childcare credit on your own return. The amount you enter must match the amount she enters on her return as self-employment income. You will need her Social Security number or Tax ID for your return.
Your mother can enter any expenses she incurred when she was babysitting such as mileage for driving the children to activities, etc., food, entertainment for them, etc. etc. on a Schedule C on her own tax return. She will be paying self-employment tax for Social Security and Medicare.
**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**
