Whether or not you have to file Schedule H depends if your mother-in-law was a household employee.
Household employees commonly include housekeepers, maids, nannies and babysitters if you control which tasks they're responsible for and how they complete them. It essentially depends on the facts and circumstances of each situation.
But if you have a nanny who lives in your home and takes care of your children five days per week, she's more likely a household employee than the plumber you call a few times per year.
See Do You Have a Household Employee?
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