If she is working in your home and does not have her own company, then you can pay her as a household employee. You can either get a free W-2 form by requesting one to be mailed from the IRS, or you can pay for one using TurboTax Quick Employer Forms either through the TurboTax Online Self-Employed version or logging into <a rel="nofollow" target="_blank" href="
http://quickemployerforms.intuit.com">http://quickemployerforms.intuit.com</a>. You can pay the payroll taxes either by creating an EFTPS account with the IRS at <a rel="nofollow" target="_blank" href="
http://www.eftps.gov">www.eftps.gov</a> or by filing IRS forms 940 and 941 (available at irs.gov) and enclosing the payment. You will need to file Schedule H with your tax return. You will also need to file your state's unemployment tax form.
If you don't want to go to all this trouble, you can pay her with a 1099-MISC. You can also do that either by getting a free form mailed to you by the IRS (takes about 10 business days) or by using TurboTax QEF.
Either way, you will be able to take the child care credit, but you need to choose one way or the other to pay your mother. If you don't send her a 1099-MISC, she will still be able to report that you paid her in cash. But the first way, with a W-2, is the way it *should* be done.
