Are you looking for a reputed accountancy firm in Santa Monica who would be helping with your nanny tax account? Before finalizing such an agency, you need to ensure that the person handling your taxes have in-depth understanding of the complex filling procedure of nanny tax. The nanny tax, which essentially comprises the combination of state and federal income taxes, includes Social Security and Medicare taxes, along with state and federal unemployment insurance taxes, paid by your employer. Filing of this nanny tax is very much complicated and a minor error on the tax return can give you an IRS-sized headache. So, you can work with an agency that offers tax services in Santa Monica. You can hire an experienced accountant Santa Monica from that agency, who has years of dealing with nanny tax.
Nanny tax is a specific category of tax and not all accountants have experience in dealing with this. A tax services firm comes with a panel of accountants, who have experience and expertise in versatile taxing categories. You can easily find one, who knows the complexities of filing nanny tax system and help you save hassle and money in the long run.
As per the government, a nanny is not a contractor but an employee and needs to be paid in that way, where a few labor laws are also thrown in, along with all the ensuing taxes. So, you need to ensure that the accountant you are hiring has up-to-date knowledge of the latest nanny tax laws and rules. Asking a few questions to the accountants would guide you in choosing the best help for the tax preparation service.
Question 1: What is the number of nanny taxes you file each year?
You need to look for an experienced accountant who has dealt with a decent volume of nanny taxes. Their answer would definitely help you choose a proper CPA firm and not any quick turnover one. This basic question would limit the time researching and the number of questions as well. You can ask the account what kinds of people he has managed tax for. If the number of professionals or business owners handled by the accountant is more, the higher is the chance that he has dealt with a return just like yours. If he has encountered with more nanny paperwork, then while preparing your file, the chance of error would be minimal. If a firm or an accountant handles nearly 50 such cases in a year with dedicated staff, then they must be having expertise in the specific regulations and laws of both state and federal nanny taxes.
Question 2: Are you familiar with payroll as well?
Not all accountants are familiar with the requirement of filing payroll tax. However, Schedule H (the form that is with 1040 for employment and household taxes) is all about payroll taxes, which includes filing quarterly federal and state taxes in order to avoid penalties, withholding the correct amount. If the company you are dealing with is large, they might have outside accountants for returns. So, you need to ask them about the review process, in order to ensure that nothing slips through the cracks.