I’m 64 and recovering from a stroke. I need help with some tasks that have piled up, like cleaning, tech setup, filing, car maintenance, and getting to appointments. If I can find someone, maybe I could get by with half a day to one day per week. Ideally, I’ll get better and won’t need the help anymore.
I’d rather not go through an agency. If I don’t, do I need to worry about paying taxes for short-term, project-based work? And if I just hire someone once a week, does that change anything?
Based on what you’re saying, it sounds like this could be classified as a household employee situation, meaning you might have to handle taxes like FICA and income tax if they want you to withhold it. This doesn’t change just because it’s a day or two a week.
One exception might be if you hire someone who sets their own hours and controls how they do the work, like an independent contractor. But that’s tricky when they’re working in your home.
If you’re on Medicaid, you could look into a Medicaid waiver program, which might help with some of these tasks.
Axel said: @Joss
Thanks for the info! I am on Medicaid. What’s this Medicaid waiver you mentioned?
It’s a program run by each state with its own name, so it varies. It’s designed to help folks get services at home instead of needing to go into a facility.
Technically, yes, you’re supposed to pay, but honestly, most people don’t. A lot of this work is done in cash and off the books. Neither side reports it, and it’s rare to get called out unless you’re high profile.
So are you hiring someone, or are you the one getting paid?
If you’re paying someone out of pocket, it doesn’t usually mean you need to withhold taxes unless it’s a formal household employee arrangement. You can pay in cash, by check, or with apps like Venmo.
If you’re getting paid, that’s different. If someone pays you more than $600 a year, you’d need to report that income on a Schedule C. Then, you’d pay self-employment tax on the net income. If you don’t have taxes withheld from other jobs, you might want to make an estimated payment to cover it.
Axel said: @Lorin
I’m planning to hire someone to help me, so I’ll be the one paying. Does that mean it’s the worker’s job to report the income and handle taxes?
It’s a bit more complicated than that. You might still be on the hook for the nanny tax.