For child care credit, we pay a friend & we have their name, address & SSN.... do we need to issue them a 1099? Must they report income? What if < $2k or <$400 (no SET)?

[mjnation]

I reference those $$ because I read that one needs to pay self employment tax if >$400 except "household employees" like cleaners or babysitting who can avoid SET if in client's home and <$2000 from any 1 client

[SweetieJean]

Where is the child care provided?

[RayW7]

If a babysitter or nanny is self-employed, and the care is not provided in your home, you don’t have reporting or withholding requirements.  The care provider still must report their income to the IRS. However, you don’t need to issue a Form 1099-NEC or withhold taxes. 

The person who received the money will have to report the income.  If you claim the Child Care Credit then the IRS will match the income to the person receiving it. 

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