Where do I enter the amount I have already paid in federal household employment taxes

[bwa]

What expenses are you referring to?  (Federal Household Employment Taxes are generally not deductible.)

[mstein]

I have a domestic household employee; we withheld social security taxes and unemployment taxes from her paycheck and paid these amounts to the federal government.  I have entered the information about the amount withheld (and that amount has therefore been added to the total amount I owe in fed taxes) ; but I cant find the spot to enter that this amount was already paid by me during 2016

[DawnC0 · Accepted solution]

If the amount withheld were paid to the IRS through 1040-ES payments, enter the amount of your withholding for your domestic employee in Estimates and Other Taxes Paid.

After you finish entering your information in the Nanny Tax section, go to:

• Federal Taxes >>
• Deductions & Credits >>
• I'll choose what I work on >>
• Estimates and Other Taxes Paid >>
• Estimates
• Federal Estimated taxes for 2016 (Form 1040-ES)

________________________

"If you pay your household employment taxes with your business employment taxes, you must report your household employment taxes with those other employment taxes on Form 941, Employer's QUARTERLY Federal Tax Return, Form 944, Employer's ANNUAL Federal Tax Return, or Form 943, Employer's Annual Federal Tax Return for Agricultural Employees, and on Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return."

You can delete your Schedule H from your return as long as your payroll company has filed all required federal returns associated with your domestic employee.  The purpose of the Schedule H is to ensure the payroll taxes are paid and the income is reported to the IRS.  Since filing Forms 941, 940, and W-2 accomplishes this goal you are not required to also file a Schedule H.

[mbj1975]

The software should ask the very simple question: do you have a payroll service handle your nanny taxes?  Many people utilize such a service, and the software leads to an overpayment by not asking this simple question.  

[scurling]

I had the same questions as I completed the household employment section of TBTX.  I watched my tax requirement increase over $8,000, but I paid all those taxes throughout the year, with the required 940 and 941 forms.

I'll follow the answer provided in this thread, and hope this gets resolved.

[scurling]

I've followed the suggested comments and entered the federal employment taxed I paid, by quarter, throughout FY-2020.

That said, I see about a $2k difference in the TBTx "Fed Tax Due" amount after entering the Domestic Employment annual salary, and the "Fed Tax Due" after completing the Estimated Tax payments to include the Federal taxes for the employment requirements.

Note:  I have always used QuickBooks Payroll service to pay the employment taxes, and file the required Federal forms 940 and 941.  So, why does TBTx   indicate a $2K difference (increase)  in the tax burden.  After entering the employment salary paid, and the Federal taxes I paid throughout the year, I think my "Fed Tax Due" would be the same as before I started entering the Domestic Employment figures.

[scurling]

I realize this issue may have been resolved, but I wanted to offer my experience with this issue.

Estimated tax entry is not where you state the payments you made for household employment taxes.  I thought that was the correct location, but the IRS came back and did not allow the entries.  The payments need to be held throughout the year (except for possibly the state tax withholding) and paid through the Schedule-H form with the annual Form 1040.  The schedule-H asks questions which should accurately calculate the required tax debt requirement for the total annual employee salary payments.  I keep my employee payments with Quickbooks payroll, and the Schedule-H was within a few dollars of the payment calculated by the Schedule-H.

See my comments below.....

I've been on this merry-go-round with the Schedule-H and filing employee and employer taxes.

You MUST file the full amount of annual taxes with your Form 1040.  The schedule H instructions states this in a single line statement, so it is easily missed.  Completing the Schedule-H form with TBTx calculates those taxes for you and allows for your state unemployment payments.  It does NOT allow for the state withholding taxes on the form.  My state, Virginia, requires me to pay withholding taxes on a quarterly basis, but the federal taxes, need to be withheld and paid with the Form 1040 filing.

Believe, me, I payed employee and employer quarterly federal taxes for two years, and also had to pay the entire tax amount with the Form 1040,  Schedule-H  submission.  This was basically a "double-taxation".  I finally had to hire a CPA to work with the IRS and develop a way to recoup/refund the quarterly takes I paid for two years.  The process is slow, and I've currently been refunded for 2 of the 8 quarters.