The Almighty SS8

My boss fired me because their old nanny returned to town. I had been working for six months, incident free. Problem, I had been working off the books. So I was terminated and have nothing to show for it. This is so wrong. What do nannies do in this situation?

Answer:
We advise nannies and employer to talk about taxes before work starts, to file appropriate tax documents and to pay their nannies legally (and fairly). Having said that, we hear from a lot of nannies that seem to have issues with the IRS because their employer would not pay them on the books or tried to pass them off as an independent contractor.

If you have a dispute with your employer over pay or taxes, it is helpful to have the conversation, in writing, whenever possible. If the situation cannot be resolved, each person must do the legal and correct thing for their own protection.

Kidding. Of course.

IRS Form SS-8 Request for Determination of Worker Status
Form SS-8 is used to request a determination from the IRS on status of workers, to determine if they are employees or independent contractors. The key areas used to determine worker status are: behavioral control, financial control, and type of relationship.

Here is a list of key information you will need to compile in order to complete this form:

• How did the worker obtain the job (bid, application, employment agency, or other
• Description of the work done by the worker
• Explanation of why you believe the worker is an employee or independent contractor
• Attach a copy of any written agreement

Specific questions to determine behavioral control; for example:

• Training and instructions 
• Work assignments 
• Problems and complaints 
• Daily routine 
• Substitutes or helpers

Specific questions to determine financial control; for example:

• Who provides supplies and materials
• Who provides leased equipment
• Are worker expenses reimbursed
• Type of pay received (salary, commission, hourly wage, piece work, lump sum, or other Drawing/advance account
• Who does the customer pay
• Economic loss/financial risk for worker

Specific questions to determine relationship of worker and firm; for example:

• Benefits available to worker, like paid vacations, sick pay, pensions, bonuses, insurance 
• Penalties for termination of relationship 
• Presence of non-compete agreement 
• Is worker in a union 
• Who provides materials, patterns, instructions 
• How the firm represents the worker to its customers

The Process A worker or employer can file Form SS-8 and receive a determination from the IRS. When the IRS receives the request, it will begin research and may come back to the firm and worker for further information. At the end of the process (which might take up to six months) the IRS will either (a) issue a determination letter, which is binding on the IRS, or (b) issue an informational letter, which is advisory but not binding.

Where to find the SS8 Form
HERE

Where To File
Send the completed and signed Form SS-8 to:

Internal Revenue Service
Form SS-8 Determinations
P.O. Box 630
Stop 631
Holtsville, NY 11742-0630

Faxed, photocopied, or electronic versions of Form SS-8 are not acceptable for the initial request for the Form SS-8 determination. Do not submit Form SS-8 with your tax return as that will delay processing time.

Tax questions, rants, dilemmas or advice? Email isynblog@gmail.com.

2015, The Rants "The Letter of the Law"

I will admit it. I am bitter. I had a brand new nanny I hired in May to work with my children. I chose her for her skills in activities and keeping the children busy. I offered her a pay rate. She asked to be paid off the books. I told her that was illegal, that we only paid on the books. She asked for more money and said she needed to bring home $750 a week. I told her I could not do that, but we would talk about a raise in the fall.

6 weeks she lasted. She didn't return one Monday. I texted her, called her and emailed her and she would not even respond. It has been brought to my attention that she is now working for another family. The single reason she left our job? She is making $800 cash per week and qualifying for a pell grant and medicaid! She's 23!

The person who told me this is another nanny who explained it to me matter of factly, as if this was the natural way she would chose to go. As in I shouldn't be offended, this is just better. Who is this better for? It's not better for my children who don't know what happened to their fun nanny. It's not better for me. As a working woman in a make dominated field, my professionalism is still called into question when I have to report childcare issues. Issues like... standing in the kitchen drinking coffee waiting for a nanny who never showed up.  It isn't better for our city or our country. It isn't better for people who deserve the aid that she is eeking up needlessly. How common is this? The way the nanny I spoke to talked to me, it was as if I should have known better.

I want to report her and her employer. Yes, because I'm bitter, but also because it's wrong. It's also wrecking our economy! Tell me what I need and who and how to report this!

She Got 1099'd

I got into an argument with my boss over unpaid overtime.
I told him, if it wasn't paid, then I couldn't continue working.
He asked me if I was quitting. I told him I didn't want to quit, but I was due my wages.
He asked me abruptly if I was working today. I indicated I was.
He told me he would talk to Linda, his wife and left in a huff.
Keep in mind, all I had done was ask for unpaid overtime (Two Thursday nights at 5 hours each, one 12 hour Saturday and one 6 hour Sunday).
So my boss comes home and says he cut me a check for the missing overtime. He said he realized he needed to keep better track of it.
So, I open the envelope and the check is there, in the correct amount.\
He also supplied a YTD 1099, projected through Friday.
I have been getting paid cash all this time, minus the check. We only ever talked about being paid off the books. Now, he is basically handing me an enormous tax bill. I am so upset! This will be like 5K just for the first half of the year as an independent contractor. How can he do this? And seriously, just because I asked for wages that were due to me? That I wanted specifically to pay off a credit card?

Email isynblog@gmail.com with your #dayinthelife, sightings or stories.

Exit Strategy

     My husband and I had a meeting with our nanny of 4.5 years on Wednesday night. We talked about changes coming up. One of our children is not going to sleep away camp, so we need someone to work a full day during the summer. This is due to personal issues, also surrounding some of the changes. We need to move towards a governess type nanny who can work one on one with once child in particular. During the conversation, the nanny said she would forgo her camp job this summer to continue working with us and that she could more than handle the tutoring and one on one with our child. She argued that no one knows him better than her. The truth is our child is on the spectrum. She does know him well, but one of the reasons we want to make changes is to improve his outlook and daily life. This would require more education and skills. We  discussed this and the nanny seems to understand we will also be looking to provide more in the way of compensation.
   

Ada Breedveld

On Thursday night, the nanny approached me alone to follow up on the conversation. She told me that she has waited for three years for me to offer her health insurance and gone without. She also told me this was illegal and that had we been paying her on the books and she was terminated for the new hire we seek, she would be entitled to unemployment. Things are deteriorating rapidly, no doubt because feelings are involved. She then told me what she would be entitled to for six months of unemployment and said she thinks that she deserves that for everything she did for our family and for the reason she was being so quickly replaced. I did not tell her, but we have already spoken to candidates about taking over the job. We wanted her to stay with us through June 26. Clearly that is not going to happen. My husband is of course irate and sees it as she is blackmailing us. I can see his side of it, but the reality is, if she were to report us to the IRS, wouldn't we owe more money? We have not paid into unemployment and we also have two part time housekeepers. For reference the amount she is asking for is $9900. I'd rather end things amicably, especially because of my son whom she is bonded with. I've also spoken to my cousin who knows her well and says that she could in reality be entitled to more than that if she extended her unemployment, and that she should get severance in addition to the unemployment amount. I'm not angry at anyone. I am just stressed and want to keep the peace. I did make the mistake of suggesting to her she could easily find another job and I would provide her with a great letter of reference. I suggested I would help her and she wouldn't need unemployment, but she bristled at that. She has taken great pride in volunteering at a local camp for underprivileged kids while my kids are in daycamp and I suggested, also to her chagrin, that perhaps that could turn into a job.

The Dreaded Tax Issue

      Taxes can be an issue for both nannies and employers, as many employers do not understand the legalities and realities of paying taxes while employing a nanny. Families see us as independent contractors, not realizing we are their employee. Should we, as nannies apply for a loan or line of credit, how does a lender or credit underwriter verify income if taxes aren't deducted from a paycheck? In other words, if a family has a full time nanny and taxes aren't paid in, how does that nanny obtain a loan without her income being verified? It all starts with a social security number, as a nanny agency explained to me. I read somewhere that if a nanny makes over $3K a year, the family is responsible for deducting all federal and state withholdings, and that Breedlove is an excellent resource to make it happen. Do any nannies out there have experience with new jobs and explaining to the employer it is a legal responsibility to withhold all taxes? Anyone employed by a family who uses or has used Breedlove in the past? This position by my calculations (mind you I am signing my work agreement this weekend) would pay $660-710 per month (it's part time), and over the course of a year would be $7900-8450/year. As a nanny, I know they have to pay taxes, and I am unsure how to bring this up to M and DB.

PS: I was the OP of the submission that appeared a few weeks concerning being intimidating to prospective families. Many of you responded with helpful advice, and I appreciate the constructive criticism. A lot of you said relax, speak from the heart and do not bring up other nannies. I relaxed and spoke from the heart. MB mentioned she had other interviews before she left, and later that evening, I got the email asking me a few more questions, along with the fact that she was very much interested. The next evening, I got the job offer. Thank you everyone for the suggestions and help! All of you are loved on the ISYN board

 Questions? Comments? Sightings? Complaints? email isynblog@gmail.com.