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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 16547
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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We paid a nanny $6300 in 2012 & Im trying to fill the W2,

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We paid a nanny $6300 in 2012 & I'm trying to fill the W2, W3 & schedule H forms. I did not withhold anything from her paycheck & intend to pay her share of the the social security & medicare taxes. I'm in the state of TX.

My questions are -

What do I enter in boxes 1(wages), 3(social security wages), 4(Social Security taxes withheld), 5(medicare wages), 6(medicare taxes withheld) for her W2?

And what value fo rthe wages should I use in schedule H?
Thanks for asking your question! I'm sorry to hear about your tax issue and I'm going to try my best to help you understand or resolve it.

In boxes 3 and 5, place $6,300. For box 4, take $6,300 and multiply it by 4.2% (in 2013 this value would be 6.2% but in 2012 it was 2% lower). For box 6, take $6,300 and multiply it by 1.45%. For box 1, add together boxes 3, 4, and 6. She will be taxed on the amount of taxes that you paid for her.

When filling out schedule H, you will use $6,300 as the wages subject to the various taxes.

A good step by step tutorial is available, HERE.

Please let me know if you need further assistance. Thanks again for using JustAnswer.com and have a great day.

** Please take a moment to rate my response as "Excellent" so that I may be compensated for assisting you today. Please let me know if my assistance was anything less than "OK Service", as I am compensated based on whether or not I have assisted you with your issue. If you need further clarifications, PLEASE WAIT TO RATE MY ANSWER UNTIL AFTER RECEIVING FOLLOW UP FROM ME. If I receive anything less than OK Service, I do not get paid. Thank you for your kind understanding in this matter. If you have difficulties rating, then simply respond stating that you are having difficulties rating and thank me for my excellent, good, or ok service and we can get the rating applied by the site. This answer is not to be construed as financial or legal advice. Please contact a local tax professional, and do not rely on this assessment to avoid penalties or to make financial decisions. This is for informational purposes only**
You should be aware that your question, as with most tax questions, can never really be answered completely...addressing all the permutations; that is because of the many assumptions that have to be made I have done my best to determine what I think you are asking and answering it in the most direct and understandable manner possible. If, however, after reviewing the questions, you have any uncertainties or further questions, please do not hesitate to ask.

Customer: replied 3 years ago.

So W2 "box 1 - wages" is higher than boxes 3 & 5, and I still use box 3(social security wages) as the basis for schedule H?


 


Based on this will the SSA & IRS reconcile even though total wages on W2 is not equal to the value on schedule H?


 


 

Thank you for your question. Your social security wages and your wages for federal income tax are not the same because you paid her employment taxes. She has to pay federal income tax on this amount, although you do not have to pay additional payroll taxes on this amount.

Box 1 and schedule H not matching is quite common in this arrangement. The Schedule H income must match the Box 3 & 5 income on the W-2.

Everything will work out. This is normal. Please let me know if you need anything additional. Thanks again for using JustAnswer.com and have a great day.

** Please take a moment to rate my response as "Excellent" so that I may be compensated for assisting you today. Please let me know if my assistance was anything less than "OK Service", as I am compensated based on whether or not I have assisted you with your issue. If you need further clarifications, PLEASE WAIT TO XXXXX UNTIL AFTER RECEIVING FOLLOW UP FROM ME. If I receive anything less than OK Service, I do not get paid. Thank you for your kind understanding in this matter. If you have difficulties rating, then simply respond stating that you are having difficulties rating and thank me for my excellent, good, or ok service and we can get the rating applied by the site. This answer is not to be construed as financial or legal advice. Please contact a local tax professional, and do not rely on this assessment to avoid penalties or to make financial decisions. This is for informational purposes only**
You should be aware that your question, as with most tax questions, can never really be answered completely...addressing all the permutations; that is because of the many assumptions that have to be made I have done my best to determine what I think you are asking and answering it in the most direct and understandable manner possible. If, however, after reviewing the questions, you have any uncertainties or further questions, please do not hesitate to ask.

Megan C and 4 other Tax Specialists are ready to help you
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