We’re a month away from the April 15th tax filing deadline for individuals, but we’re only two weeks from the electronic filing deadline for employers, including household employers. If you haven’t filed yet, here are some tax time reminders about what you need to do, plus how to take advantage of a couple of ways to reduce your tax burden.
If you haven’t done so already, you must electronically file your copy (Copy A) of an employee’s Form W-2 and Form W-3 to the Social Security Administration by March 31. The W-3 is a reconciliation of all W-2s for each of your employees, even if you have only one domestic worker. Also, you’ll need to file Schedule H with your federal income tax return. Schedule H is an annual reconciliation form that is used to report Social Security, Medicare, unemployment, and federal income taxes, as well as wages paid to your employee throughout the year (GTM clients can find these forms under the “Reports” tab in your online account).
Looking to reduce what you owe? Reimburse your dependent care expenses with pre-tax funds through an employer-sponsored Flexible Spending Account (FSA). You are allowed to set aside up to $5,000 per year of tax-free money. Check with your own employer’s human resources department to see if there is a program available to you.
You can also take advantage of the Child and Dependent Care Tax Credit on your personal income tax return (regardless of income level or filing status). Claim up to $3,000 of qualifying child care expenses (such as your nanny’s salary) for one qualifying individual or up to $6,000 if you have two or more children. You can reduce your taxes by 20 percent of your claimed expenses (i.e. up to $600 for one child and $1,200 for two children).
Need help? Give us a call at (518) 348-0400 and we’ll be happy to assist.