Social Security and Medicare taxes are collectively referred to as the “FICA” tax because they are collected at the same time. This is a 7.65 percent tax that is paid into the FICA system by both employees and their employers. It is automatically deducted from each paycheck, usually by your employer, and is reflected as such on your paystubs and W-2 forms.
Employing household employees and paying them cash wages of $2,400 or more in cash wages in the year 2022 means that you, too, will be required to withhold 7.65 percent (6.2 percent for social security and 1.45 percent for Medicare taxes) from all cash wages you pay that employee.
If you prefer, you can pay your employee’s share of the FICA tax out of your own pocket using your own funds if you so choose. This does not relieve you of the responsibility of paying your own FICA tax; as an employer, you are also responsible for paying your share of the FICA tax, which is the same 7.65 percent of cash wages as employees.
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In most cases, you will not be required to pay your spouse, your child who is under the age of 21, your parent (with some exceptions), or an employee who is under the age of 18 at any time during the year in which you would otherwise be claiming them.
When it comes to those under the age of 18, there are some exceptions, such as when household work is the minor’s primary source of income. If they are a student and work as an employee in your household, work is not considered their primary occupation; rather, being a student is considered their primary occupation.
Domestic employees include people who work in your home or in a private residence such as housekeepers, maids, gardeners, babysitters, and other people who work in your home or in a private residence.
Because they provide work to you as independent contractors and are employed by their own companies, employees such as plumbers and repairmen are excluded from the definition of personal employees.
According to the Internal Revenue Service, “Household workers are your employees if you have control over not only the work they do but also the manner in which they do it.”