Do I have to give my SSN/address (for a 1099) to a family I babysat for?

[Anonymous]

Last year, I babysat for a family whom I found through Sittercity. I was with them for ~2-3 weeks. I was paid weekly by personal check. In total, I earned $450 during my time with them. There was never any discussion of my being an employee or independent contractor [i.e. they didn't have me complete a W4 or W9] prior to my starting to babysit.

The family texted me today saying they need my address & SSN to send me a 1099. My parents file me as dependent since I'm <24 yrs old, a full-time student, and still live with them- so I always just gave them my W2's and they took care of filing taxes. 

I was planning to claim the $450 on the tax return as "other income." But I've (now) learned that the 1099 the dad wants to give me is for me to have to file self-employment taxes as an independent contractor. Am I obligated to provide him with my information? Could I get in trouble (legally) if I ignored his request? Does this mean I will have to pay self-employment taxes on the $450? What should I tell him?

[MaryK1 · Accepted solution]

To start, because you were paid for babysitting you MUST provide your social security number to the family.  If you ignore them or refuse, they will provide the IRS with any information they have about you and the IRS will look for you.  The family probably needs the information to claim the Child Care Tax Credits.  They are not required to issue you a 1099-MISC because the payment was less than $600 but they can, either way you do have to report the income as independent contractor, and unfortunately, you are required to file the self employment tax if you made more than $400.  (You will probably pay very little tax but if you do not pay it now, the interest and penalties will be assessed)  You should wait to see if you receive the 1099-MISC then have your parents prepare your return including the information.  If you have any questions, please add in the comments.

[Anonymous]

Thanks for you reply! I am confused as to why I would be required to file as 1099 if I worked in their home, had a set schedule, abided by their rules, etc.? If anything, wouldn't I be an employee?

Why wouldn't I be able to claim the babysitting money as "other income" since I wasn't their employee or an independent contractor (since neither of these titles were established prior to or during my time babysitting)?

[MaryK1]

It would be unusual for them to issue the 1099-MISC because individuals are not required to file and as I said the threshold is $600.  I think as I said they need your social security number so that they can claim their child care credit.  You are also correct that you could dispute the employee classification, however, they may also classify you as a Household Employee so they can still issue a W2 for you which is more correct (both are due by Jan 31 so if you receive either you should receive it soon unless they fie late)

[Anonymous]

Ok, I see. I can't post links here, but I read an article titled "Why Caregivers Shouldn't Get a 1099 Form," and I was under the impression that I made less than the threshold to have to file for/pay nanny taxes.

[Anonymous]

Ok, I see. I can't post links here, but I read an article titled "Why Caregivers Shouldn't Get a 1099 Form," and I was under the impression that I made less than the threshold to have to file for/pay nanny taxes.

[MaryK1]

Yes, as I said, I think they need your social security number for the child tax credit, it is unlikely that they would send a 1099-MISC but unfortunately you cannot do anything unless/until they do.  If you can, try to wait a few weeks to see.

[MaryK1]

but I would not avoid giving them your social security number because that could get YOU in trouble with the IRS regardless of what they do because they did pay you

[American statesman]

Where do you people come up with these Insane answers based on what ? Not law !!??? I’m not going to site the specific CFR code which in a very vague way as is typical tax code formula but specifically exempts personal services performed in a private home as exempt but also any amount of renumeration under 900 dollars is also exempt because the tax code is made up of contracts law and with that whether or not you are subject to a tax if you submit a contract that says you are then you are in fact now legally obligated so for your info don’t give your info to anyone especially your Social Security number and definitely don’t claim a liability that you haven’t read 

And plainly understood to implicate your liability and that is based on the federal general fairness rules of legislation to sum up mean that a law must be read and understood By A normal person not some fancy educated lawyer and if the law is so vague and ambiguous Then it does not apply

[American statesman]

§ 31.3401(a)(3)-1 Remuneration for domestic service.

(a) In a private home.

(1) Remuneration paid for services of a household nature performed by an employee in or about a private home of the personby whom he is employed is excepted from wages and hence is not subject to withholding. A private home is a fixed place of abode of an individual or family. A separate and distinct dwelling unit maintained by an individual in an apartment house, hotel, or other similar establishment may constitute a private home. If a dwelling house is used primarily as a boarding or lodging house for the purpose of supplying board or lodging to the public as a business enterprise, it is not a private home, and the remuneration paid for services performed therein is not within the exception.

[American statesman]

2) In general, services of a household nature in or about a private home include services performed by cooks, waiters, butlers, housekeepers, governesses, maids, valets, baby sitters, janitors, laundresses, furnacemen, caretakers, handymen, gardeners, footmen, grooms, and chauffeurs of automobiles for family use.

[xmasbaby0]

This is likely a very old thread that migrated over from the old user forum when the user forum changed in June of 2019 to Real Money Talk, and many threads migrated over with 2019 dates even if they were much older.

But it has been brought up again because of a recent post.  So....for anyone reading this thread.....if you work as a nanny or babysitter and are NOT a household employee-----if you make $400 or more, you are considered to be an independent contractor and must pay self-employment tax on your earnings for Social Security and Medicare, and may also owe ordinary income tax.  The person who you provide childcare for wants.needs a Social Security number or a Tax ID number from you so that they can claim the childcare credit on their own tax return.  You are obliged to provide either your SSN or a Tax ID.  If you prefer not to give out your SSN, then it is simple to obtain a Tax Identification Number   (TIN) from the IRS.

https://www.irs.gov/individuals/international-taxpayers/taxpayer-identification-numbers-tin

The person you babysat for can use that number when they report the amount they paid for childcare.  And you are required to report self-employment income of $400 or more to the IRS on a tax return---the IRS will match up the amount reported by the person who paid you with the tax return you file.

If you incur expenses --such a mileage for driving a child to school, after school activities, etc. or if you babysit in your home, there are expenses you can claim on a Schedule C when you prepare your own tax return.

https://ttlc.intuit.com/community/self-employed/help/what-is-the-self-employment-tax/00/25922

https://ttlc.intuit.com/questions/2902389-why-am-i-paying-self-employment-tax

https://ttlc.intuit.com/questions/2903027-how-do-i-report-income-from-self-employment

https://ttlc.intuit.com/questions/1901340-where-do-i-enter-schedule-c

https://ttlc.intuit.com/questions/3398950-what-self-employed-expenses-can-i-deduct

[Carl]

Am I obligated to provide him with my information?

Yes. But instead of providing your SSN (which I HIGHLY discourage) you should provide them with an EIN (Employer Identification Number) which you can get for absolutely free directly from the IRS in about 10 minutes starting at https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-n...

Could I get in trouble (legally) if I ignored his request?

It's perfectly possible. But understand it's not like the IRS will send unmarked black hawk helicopters to hog tie you and haul you back to the IRS dungeons because you didn't follow tax law and report the income. More than likely you would get a bill in the mail for the taxes on that income, plus interest due on those taxes, and possibly an additional fine for having not reported it in the first place. Now if you ignore that bill, I can't offer any guarantees about those black hawks. 🙂

Assuming you don't meet the requirements to be classified as a household employee (I assume you don't since they want to issue a 1099-MISC) you are required to report that income on your own tax return, since it's self-employment income that exceeds $400 for the entire tax year.

If your total income from all sources for the entire tax year is under $12,000 (can be significantly less in some cases) then you don't pay any "regular" taxes. However, for the amount of self-employment income that exceeds $400, you will pay a 15.3% self-employment tax on something close to 97% of that amount that is over $400. So if you've already filed a 2019 tax return or will be filing one, your "late fees" will be minimal. Your self-employment income as a babysitter will be reported on SCH C as a part of your 1040 tax return.

For more details that explains exactly what the SE tax is and more, please see https://www.irs.gov/businesses/small-businesses-self-employed/self-employment-tax-social-security-an...