@mbj_9019 wrote:
Thanks. I jusy want to confirm my understanding of nanny tax. I cannot pay nanny tax since they are my parents. Am I correct?
I think you want to voluntarily pay household employee tax even though it is not required, to create a credit for your parents. That's getting to be close to a legal question I shouldn't answer, except to point out the language in the IRS documentation.
https://www.irs.gov/publications/p926
Wages not counted.
Don't count wages you pay to any of the following individuals as social security or Medicare wages, even if these wages are $2,400 or more during the year.
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Your spouse.
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Your child who is under the age of 21.
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Your parent. Exception: Count these wages if both the following conditions apply.
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Your parent cares for your child (including an adopted child or stepchild) who is either of the following.
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Under the age of 18.
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Has a physical or mental condition that requires the personal care of an adult for at least 4 continuous weeks in the calendar quarter services were performed.
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Your marital status is one of the following.
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You’re divorced and haven't remarried.
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You’re a widow or widower.
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You’re living with a spouse whose physical or mental condition prevents him or her from caring for your child for at least 4 continuous weeks in the calendar quarter services were performed.
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An employee who is under the age of 18 at any time during the year. Exception: Count these wages if providing household services is the employee's principal occupation. If the employee is a student, providing household services isn't considered to be his or her principal occupation.
