{"id":887,"date":"2012-10-11T02:54:52","date_gmt":"2012-10-11T09:54:52","guid":{"rendered":"http:\/\/www.enannysource.com\/blog\/?p=887"},"modified":"2012-09-30T13:58:13","modified_gmt":"2012-09-30T20:58:13","slug":"the-benefits-of-paying-legally","status":"publish","type":"post","link":"http:\/\/www.enannysource.com\/blog\/index.php\/2012\/10\/11\/the-benefits-of-paying-legally\/","title":{"rendered":"The Benefits of Paying Legally"},"content":{"rendered":"<p><strong>\u2026and the Consequences of Paying \u201cUnder the Table\u201d<\/strong><\/p>\n<p><em><a href=\"http:\/\/www.enannysource.com\/blog\/wp-content\/uploads\/2012\/09\/bobking12.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignright size-full wp-image-888\" title=\"bobking1\" src=\"http:\/\/www.enannysource.com\/blog\/wp-content\/uploads\/2012\/09\/bobking12.jpg\" alt=\"\" width=\"200\" height=\"268\" \/><\/a>When it comes to paying your nanny legally, it makes sense to get the inside scoop from an attorney who specializes in household employment law. Enter Bob King, Esq., Founder, Legally Nanny<sup>\u00ae<\/sup>. I reached out to Bob and asked him to provide his take on the benefits of paying your nanny legally \u2013 and the consequences that can come along if you don\u2019t. Here\u2019s what he put together for our enannysource.com readers.<\/em><\/p>\n<p>By Bob King, Esq.<\/p>\n<p>It\u2019s not easy being a household employer. For some, the legal, tax, and insurance issues make paying their employees \u201cunder the table\u201d seem easier and cheaper. But this decision can be penny-wise and pound-foolish if you get caught. Even if you don\u2019t get caught, you\u2019ll be missing out on legal and tax advantages that you can\u2019t use if you\u2019re paying illegally.<\/p>\n<p><strong>Getting Caught<\/strong><\/p>\n<p>Make no mistake, getting caught paying someone \u201cunder the table\u201d is easier than you think. For example, if your household employee files for unemployment, social security, disability, or workers compensation benefits, you\u2019ll likely get caught for not paying her employment taxes.<\/p>\n<p>Or maybe your employee quits and turns you in \u2013 or tries to blackmail you. Or a disgruntled neighbor reports you.<\/p>\n<p>Under any of these scenarios, the result is the same: <strong>YOU GET CAUGHT and face the consequences.<\/strong><strong>\u00a0<\/strong><\/p>\n<p>And what are the consequences of paying illegally? They can include:<\/p>\n<ul>\n<li>paying all back taxes, penalties and interest<\/li>\n<li>charges of perjury and tax fraud<\/li>\n<li>up to $250,000 in fines and up to 5 years imprisonment<\/li>\n<li>ruining your reputation and career.<\/li>\n<\/ul>\n<p><strong>Advantages to Hiring Legally<\/strong><\/p>\n<p>But there are advantages to hiring and paying nannies, elder care providers, and other domestic employees legally! If eligible, you may be able to maximize your tax savings in a number of ways, including:<\/p>\n<ul>\n<li>Save taxes by putting up to $5,000 pre-tax per family per year into a Dependent Care Account to help pay for your nanny.<\/li>\n<li>Eligibility for the federal Child and Dependent Care Tax Credit for a minimum tax <strong>credit<\/strong> of 20% for the first $3,000 in qualifying expenses for each of your first two children per year.<\/li>\n<\/ul>\n<p>In addition to these potential tax savings,<strong> <\/strong>another advantage to paying legally is your peace of mind. Don\u2019t underestimate how worrying about getting caught and the consequences of hiring illegally can take a toll on you personally and professionally.<\/p>\n<p><strong>The Bottom Line<\/strong><\/p>\n<p>After maximizing your potential tax advantages, paying a nanny legally can add <strong>as little as 4%<\/strong> to your cost. On a $20,000 annual salary, that\u2019s roughly an additional $800, a small price to pay for the peace of mind that comes along with paying legally. Regardless, the significant consequences of getting caught mean that it\u2019s just not worth the risk of paying under the table.<\/p>\n<p>Bob King, Esq. is the Founder of Legally Nanny, the leading law firm representing household employers and domestic employment and homecare agencies.\u00a0 Legally Nanny assists clients in hiring, employing, and paying nannies, elder care providers, and other household employees legally.\u00a0 For more information, feel free to contact the firm at (714) 336-8864 or at <a href=\"mailto:info@legallynanny.com\">info@legallynanny.com<\/a> for a free initial consultation.<\/p>\n<p><em>\u00a9 Copyright 2012 Legally Nanny<sup>\u00ae<\/sup>. All rights reserved. This article is for informational purposes only; it is not legal advice. This material is not intended to seek employment in any jurisdiction in which Legally Nanny is not allowed to provide professional services.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>\u2026and the Consequences of Paying \u201cUnder the Table\u201d When it comes to paying your nanny legally, it makes sense to get the inside scoop from an attorney who specializes in household employment law. Enter Bob King, Esq., Founder, Legally Nanny\u00ae. &hellip; <a href=\"http:\/\/www.enannysource.com\/blog\/index.php\/2012\/10\/11\/the-benefits-of-paying-legally\/\">Continue reading <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[103],"tags":[],"class_list":["post-887","post","type-post","status-publish","format-standard","hentry","category-expert-insights"],"_links":{"self":[{"href":"http:\/\/www.enannysource.com\/blog\/index.php\/wp-json\/wp\/v2\/posts\/887","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/www.enannysource.com\/blog\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.enannysource.com\/blog\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.enannysource.com\/blog\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.enannysource.com\/blog\/index.php\/wp-json\/wp\/v2\/comments?post=887"}],"version-history":[{"count":2,"href":"http:\/\/www.enannysource.com\/blog\/index.php\/wp-json\/wp\/v2\/posts\/887\/revisions"}],"predecessor-version":[{"id":890,"href":"http:\/\/www.enannysource.com\/blog\/index.php\/wp-json\/wp\/v2\/posts\/887\/revisions\/890"}],"wp:attachment":[{"href":"http:\/\/www.enannysource.com\/blog\/index.php\/wp-json\/wp\/v2\/media?parent=887"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.enannysource.com\/blog\/index.php\/wp-json\/wp\/v2\/categories?post=887"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.enannysource.com\/blog\/index.php\/wp-json\/wp\/v2\/tags?post=887"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}