OPINION: Workers in your home and Social Security taxes

Published 4:43 pm Monday, March 14, 2022

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By Lisa Wallace

Social Security Public Affairs Specialist in North Carolina

Do you plan to pay a cleaning person, cook, gardener, babysitter or other household worker at least $2,400 in 2022? If you will pay at least $2,400 to one person during the year, which may include transportation, meals and housing, you have additional financial responsibilities to consider. 

When you pay at least $2,400 in wages to a household worker, you must do all of the following:

Deduct Social Security and Medicare taxes from those wages.

• Pay these taxes to the Internal Revenue Service.

Report the wages to Social Security.

Accurate reporting is important as employees earn credits toward Social Security benefits and Medicare coverage. You can currently earn Social Security or Medicare credit for every $1,510 in wages that are reported.  Generally, people need 10 years of work to qualify for:

Retirement benefits (as early as age 62).

• Disability benefits for the worker and the worker’s dependents.

Survivors benefits for the worker’s family.

• Medicare benefits.

You can learn more about reporting household worker income by reading Household Workers at www.ssa.gov/pubs/EN-05-10021.pdf.