Household Employment Taxes

i1040_schedule ins_h--2015-00-00

Household Employment Taxes

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Department of the Treasury
Internal Revenue Service

2015 Instructions for Schedule H (Form 1040)
Household Employment Taxes
Household
Employers

Here is a list of forms you need to complete:
Schedule H for figuring your household employment taxes.
Form W-2 for reporting wages paid to your employees.
Form W-3 for sending Copy A of Form(s) W-2 to the Social Security Administration (SSA).
For more information, see What Forms Must You File? in Pub. 926, Household
Employer's Tax Guide.
No household employees in 2015? If you didn't have any household employees in
2015, you don't have to file Schedule H for 2015.

We have been asked:
What do I do after I fill in Schedule H? If you must file a 2015 tax return, enter the
taxes from Schedule H on the “Household employment taxes” line of your Form 1040,
1040NR, 1040-SS, or 1041. You do this because these taxes are added to your income
taxes.
How do I file Schedule H? File Schedule H with your Form 1040, 1040NR,
1040-SS, or 1041. If you aren't filing a 2015 tax return, file Schedule H by itself.
Do I make a separate payment? No. You pay both income and employment taxes to
the United States Treasury when you file Schedule H with your return.
When do I pay? Most filers must pay by April 18, 2016 (April 19, 2016, if you live
in Maine or Massachusetts).
How many copies of Form W-3 do I send to the SSA? Send one copy of Form W-3
with Copy A of Form(s) W-2 to the SSA, and keep one copy of Form W-3 for your
records. Instructions for filing Forms W-2 and Form W-3 electronically are available
at www.socialsecurity.gov/employer.

Important Dates!
By . . . . . . . . . . . . . . . . . . . .

You must . . . . . . . . . . . . . . . . . . . . . . . . . . .

February 1, 2016
February 29, 2016 (March 31, 2016, if
you file electronically)
April 18, 2016 (April 19, 2016, if you
live in Maine or Massachusetts)

Give your employee Form W-2.
Send Copy A of Form(s) W-2 with Form W-3 to the SSA.
Visit www.socialsecurity.gov/employer for details.
File Schedule H and pay your household employment taxes
with your 2015 tax return.

Section references are to the Internal Revenue Code unless
otherwise noted.

Contents
What's New . . . . . . . . . . . . . . . . . . . . . . . . . .
Reminders . . . . . . . . . . . . . . . . . . . . . . . . . . .
Who Needs To File Schedule H? . . . . . . . . . . . .
Who Needs To File Form W-2 and Form W-3? . .
Do You Have an Employer Identification Number
(EIN)? . . . . . . . . . . . . . . . . . . . . . . . . . .

Contents
Page

Can Your Employee Legally Work in the United
States? . . . . . . . . . . . . . . . . . . . . . . . . .
What About State Employment Taxes? . . . . . . .
When and Where To File . . . . . . . . . . . . . . . .
Schedule H . . . . . . . . . . . . . . . . . . . . . .
Form W-2 and Form W-3 . . . . . . . . . . . . .

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Dec 22, 2015

Cat. No. 21451X

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Contents

which you pay wages in excess of $200,000 to an employee
and continue to withhold it each pay period until the end of the
calendar year. Additional Medicare Tax is only imposed on the
employee. There is no employer share of Additional Medicare
Tax. All wages that are subject to Medicare tax are subject to
Additional Medicare Tax withholding if paid in excess of the
$200,000 withholding threshold.
For more information on Additional Medicare Tax, visit
IRS.gov and enter “Additional Medicare Tax” in the search
box.
Outsourcing payroll duties. You are responsible to ensure
that tax returns are filed and deposits and payments are made,
even if you contract with a third party to perform these acts.
You remain responsible if the third party fails to perform any
required action. If you choose to outsource any of your payroll
and related tax duties (that is, withholding, reporting, and paying over social security, Medicare, FUTA, and income taxes) to
a third-party payer, such as a payroll service provider or reporting agent, visit IRS.gov and enter “outsourcing payroll duties”
in the search box for helpful information on this topic.
Paid preparers are required to sign Schedule H. Your paid
preparer must sign Schedule H in Part IV unless you are attaching Schedule H to Form 1040, 1040NR, 1040-SS, or Form
1041. A paid preparer must sign Schedule H and provide the
information requested in the Paid Preparer Use Only section
only if the preparer was paid to prepare Schedule H and isn't
your employee. The preparer must give you a copy of the return in addition to the copy to be filed with the IRS.
If you are required to file a 2015 Form W-2 for any household employee, you must also send Form W-3 with Copy A of
Form(s) W-2 to the SSA. You are encouraged to file your
Forms W-2 and W-3 electronically. Visit the SSA's Employer
W-2 Filing Instructions & Information website at
www.socialsecurity.gov/employer to learn about electronic filing.

Page

How To Fill In Schedule H, Form W-2, and Form W-3

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Schedule H . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Form W-2 and Form W-3 . . . . . . . . . . . . . . . . . . . . 8

Estimated Tax Penalty . . . . . . . . . . . . . . . . . . . .
What Records To Keep . . . . . . . . . . . . . . . . . . .
What Is the Earned Income Credit (EIC)? . . . . . . .
Rules for Business Employers . . . . . . . . . . . . . . .
State Disability Payments . . . . . . . . . . . . . . . . . .
How To Correct Schedule H . . . . . . . . . . . . . . . .
How To Get Forms and Publications . . . . . . . . . .
Completed Examples of Schedule H, Form W-2, and
Form W-3 . . . . . . . . . . . . . . . . . . . . . . . . .
Privacy Act and Paperwork Reduction Act Notice . .

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Future Developments
For the latest information about developments related to Schedule H and its instructions, such as legislation enacted after they
were published, go to www.irs.gov/scheduleh.

What's New
Changes to tax rates and wage threshold. The social security tax rate is 6.2% each for the employee and employer, unchanged from 2014. The social security wage base limit is
$118,500.
The Medicare tax rate is 1.45% each for the employee and
employer, unchanged from 2014. There is no wage base limit
for Medicare tax. Social security and Medicare taxes apply to
the wages of household workers you pay $1,900 or more in
cash or an equivalent form of compensation in 2015.
For information about the rates and wage threshold that will
apply in 2016, see Pub. 926 (released in December 2015).
Credit reduction state. A state that hasn't repaid money it
borrowed from the federal government to pay unemployment
benefits is a “credit reduction state.” The Department of Labor
determines these states. If an employer pays wages that are
subject to the unemployment tax laws of a credit reduction
state, that employer must pay additional federal unemployment
tax.
For 2015, there are credit reduction states. If you paid wages
that were subject to the unemployment compensation laws of a
credit reduction state, your credit against federal unemployment tax will be reduced based on the credit reduction rate (for
example, .015 or .021) for that credit reduction state.

Who Needs To File Schedule H?
You must file Schedule H if you answer “Yes” to any of the
questions on lines A, B, or C of Schedule H.
Did you have a household employee? If you hired someone
to do household work and you could control what work he or
she did and how he or she did it, you had a household employee. This is true even if you gave the employee freedom of action. What matters is that you had the right to control the details of how the work was done.
Example. You paid Betty Oak to babysit your child and do
light housework 4 days a week in your home. Betty followed
your specific instructions about household and child care duties. You provided the household equipment and supplies Betty
needed to do her work. Betty is your household employee.
Household work is work done in or around your home.
Some examples of workers who do household work are:

Reminders

Babysitters
Caretakers
Cleaning people

Additional Medicare Tax withholding. In addition to withholding Medicare tax at 1.45%, you must withhold a 0.9% Additional Medicare Tax from wages you pay to an employee in
excess of $200,000 in a calendar year. You are required to begin withholding Additional Medicare Tax in the pay period in

H-2

Drivers
Health aides
Housekeepers

Nannies
Private nurses
Yard workers

Can Your Employee Legally Work in
the United States?

If a worker is your employee, it doesn't matter whether the
work is full or part-time or that you hired the worker through
an agency or from a list provided by an agency or association.
Also, it doesn't matter if the wages paid are for work done
hourly, daily, weekly, or by the job.
If you are a home care service recipient receiving home care
services through a program administered by a federal, State, or
local government agency, and the person who provides your
care is your household employee, you can ask the IRS to authorize an agent under section 3504 to report, file, and pay all
federal employment taxes, including FUTA taxes, on your behalf. See Form 2678, Employer/Payer Appointment of Agent,
for more information.

It is unlawful to employ a person who can't legally work in the
United States. When you hire a household employee to work
for you on a regular basis, you and the employee must each
complete part of the U.S. Citizenship and Immigration Services
(USCIS) Form I-9, Employment Eligibility Verification. You
must verify that the employee is either a U.S. citizen or a person who can legally work in the United States and you must
keep Form I-9 for your records. You can get the form and the
USCIS Handbook for Employers by visiting the USCIS website at www.uscis.gov, or by calling 1-800-870-3676.

What About State Employment
Taxes?

Note. If a government agency or third-party agent reports and
pays the employment taxes on wages paid to your household
employee on your behalf, you don't need to file Schedule H to
report those taxes.
Workers who aren't your employees. Workers you get from
an agency aren't your employees if the agency is responsible
for who does the work and how it is done. Self-employed
workers are also not your employees. A worker is self-employed if only he or she can control how the work is done. A
self-employed worker usually provides his or her own tools
and offers services to the general public in an independent
business.

If you employed a household employee in 2015, you probably
have to pay contributions to your state unemployment fund for
2015. To find out if you do, contact your state unemployment
tax agency. For a list of state unemployment tax agencies, visit
the
U.S.
Department
of
Labor's
website
at
www.workforcesecurity.doleta.gov/unemploy/agencies.asp.
You should also find out if you need to pay or collect other
state employment taxes or carry workers' compensation insurance.

Example. You made an agreement with Paul Brown to care
for your lawn. Paul runs a lawn care business and offers his
services to the general public. He hires his own helpers, instructs them how to do their jobs, and provides his own tools
and supplies. Neither Paul nor his helpers are your employees.
For more information, see Pub. 926.

When and Where To File
Schedule H
If you file Form 1040, 1040NR, 1040-SS, or 1041 for 2015, remember to attach Schedule H to it. Mail your return, by April
18, 2016 (April 19, 2016, if you live in Maine or Massachusetts), to the address shown in your tax return instructions.
Exceptions. If you get an extension of time to file your return,
file it with Schedule H by the extended due date. If you are a
fiscal year filer, file your return and Schedule H by the due
date of your fiscal year return, including extensions.

Who Needs To File Form W-2 and
Form W-3?
You must file Form W-2 for each household employee to
whom you paid $1,900 or more of cash wages in 2015 that are
subject to social security and Medicare taxes. To find out if the
wages are subject to these taxes, see the instructions for Schedule H, lines 1, 3, and 5. Even if the wages aren't subject to
these taxes, if you withheld federal income tax from the wages
of any household employee, you must file Form W-2 for that
employee.

Note. If you are a calendar year taxpayer and have no household employees for 2015, you don't have to file Schedule H for
2015.
If you aren't required to file a 2015 tax return (for example,
because your income is below the amount that requires you to
file), you must file Schedule H by itself by April 18, 2016
(April 19, 2016, if you live in Maine or Massachusetts). Complete Schedule H and put it in an envelope with your check or
money order. Don't send cash. See the list of filing addresses in
these instructions. Mail your completed Schedule H and payment to the address listed for the place where you live. Make
your check or money order payable to the “United States
Treasury” for the total household employment taxes due. Enter
your name, address, SSN, daytime phone number, and “2015
Schedule H” on your check or money order. Household employers that are tax-exempt, such as churches, may also file
Schedule H by itself.

If you file one or more Forms W-2, you must also file Form
W-3.

Do You Have an Employer
Identification Number (EIN)?
If you have household employees, you will need an EIN to file
Schedule H. If you don't have an EIN, see Form SS-4. Don't
use a social security number (SSN) in place of an EIN. The Instructions for Form SS-4 explain how you can get an EIN immediately over the internet, in 4 business days by fax, or in
about 4 weeks if you apply by mail. See How To Get Forms
and Publications for details on how to get forms and publications including Form SS-4. To get an EIN over the internet,
visit IRS.gov and enter “EIN” in the search box.

H-3

Form W-2 and Form W-3

Your spouse.
Your child who was under age 21.
Your parent. (See Exception for parents below.)
Your employee who was under age 18 at any time during
2015. If the employee wasn't a student, see Exception for employees under age 18 below.

By February 1, 2016, you must give Copies B, C, and 2 of
Form W-2 to each employee. You will meet this requirement if
the form is properly addressed, mailed, and postmarked no later than February 1, 2016.
By February 29, 2016 (March 31, 2016, if you file Forms
W-2 and W-3 electronically), send Copy A of all Forms W-2
with Form W-3 to the SSA. Mail Copy A of all Forms W-2
with Form W-3 to:

Exception for parents. Include the cash wages you paid
your parent for work in or around your home if both 1 and 2
below apply.
1. Your child who lived with you was under age 18 or had
a physical or mental condition that required the personal care
of an adult for at least 4 continuous weeks during the calendar
quarter in which services were performed. A calendar quarter is
January through March, April through June, July through September, or October through December.
2. You were divorced and not remarried, a widow or widower, or married to and living with a person whose physical or
mental condition prevented him or her from caring for the child
during that 4-week period.

Social Security Administration
Data Operations Center
Wilkes-Barre, PA 18769-0001
For certified mail, the ZIP code is 18769-0002. If you use a
carrier other than the U.S. Postal Service, add “ATTN: W-2
Process, 1150 E. Mountain Dr.” to the address and change the
ZIP code to “18702-7997.”

If you file Forms W-2 and W-3 electronically, don't
mail the paper Forms W-2 and W-3 to the SSA.

Exception for employees under age 18. Include the cash
wages you paid to a person who was under age 18 and not a
student if providing household services was his or her principal
occupation.
Cash wages. Cash wages include wages paid by check, money
order, etc. Cash wages don't include the value of food, lodging,
clothing, or other noncash items you give a household employee.

CAUTION

For more information on filing Forms W-2 and W-3 electronically, visit the SSA's Employer W-2 Filing Instructions &
Information website at www.socialsecurity.gov/employer.
Note. Check with your state, city, or local tax department to
find out if you must file Copy 1 of Form W-2.
Penalties. You may have to pay a penalty if you don't give
Forms W-2 to your employees or file Copy A of the forms with
the SSA by the due dates. You may also have to pay a penalty
if you don't show your employee's SSN on Form W-2 or don't
provide correct information on the form.

Transportation (commuting) benefits. For 2015, you can
generally give your employee transportation benefits such as
$250 per month for combined commuter highway vehicle
transportation and transit passes; $250 per month for qualified
parking; or for a calendar year, $20 multiplied by the number
of qualified bicycle commuting months during that year for
qualified bicycle commuting reimbursement of expenses incurred during the year, without the benefits counting as cash.
However, the value of benefits over the specified amounts a
month is included as wages. See Transportation (Commuting)
Benefits in Pub. 15-B for more information.

How To Fill In Schedule H, Form
W-2, and Form W-3
Schedule H

CAUTION

Part I. Social Security, Medicare, and
Federal Income Taxes

If you were notified that your household employee received payments from a state disability plan, see State
Disability Payments, later.

Social security and Medicare taxes fund retirement, survivor,
disability, and health benefits for workers and their families.
You and your employees generally pay these taxes in equal
amounts.
You aren't required to withhold federal income tax from wages you pay a household employee. You should withhold federal income tax only if your household employee asks you to
withhold it and you agree. The employee must give you a completed Form W-4, Employee's Withholding Allowance Certificate.
For 2015, the social security tax rate is 6.2% each for you
and your employee. The Medicare tax rate is 1.45% each. The
limit on wages subject to social security tax is $118,500. There
is no limit on wages subject to the Medicare tax. If you didn't
deduct the employee's share from his or her wages, you must
pay the employee's share and your share (a total of 12.4% for

Social security number (SSN). Enter your SSN. Form 1041
filers, don't enter a number in this space. But be sure to enter
your EIN in the space provided.
Employer identification number (EIN). An EIN is a
nine-digit number assigned by the IRS. The digits are arranged
as follows: 00-0000000. Enter your EIN in the space provided.
If you don't have an EIN, see Do You Have an Employer Identification Number (EIN), earlier. If you applied for an EIN but
haven't received it, enter “Applied For” and the date you applied. Don't use your SSN as an EIN.
Line A. To figure the total cash wages you paid in 2015 to
each household employee, don't include amounts paid to any of
the following individuals.

H-4

social security and 2.9% for Medicare tax) of tax. See Form
W-2 and Form W-3 in these instructions for more information.

If you file
Form. . .

Then enter the amount from
Schedule H, line 8, on. . .

In addition to withholding Medicare tax at 1.45%, you must
withhold a 0.9% Additional Medicare Tax from wages you pay
to an employee in excess of $200,000 in a calendar year. You
are required to begin withholding Additional Medicare Tax in
the pay period in which you pay wages in excess of $200,000
to an employee and continue to withhold it each pay period until the end of the calendar year. Additional Medicare Tax is only imposed on the employee. There is no employer share of
Additional Medicare Tax. All wages that are subject to Medicare tax are subject to Additional Medicare Tax withholding if
paid in excess of the $200,000 withholding threshold.

1040

line 60a

1040NR

line 59a

1040-SS

Part I, line 4

1041

Schedule G, line 6

If you don't file any of the above forms, complete Schedule H,
Part IV and follow the instructions under When and Where To
File.

Part II. Federal Unemployment (FUTA) Tax
FUTA tax, with state unemployment systems, provides for payments of unemployment compensation to workers who have
lost their jobs. Most employers pay both a federal and state unemployment tax.

For more information on Additional Medicare Tax, visit
IRS.gov and enter “Additional Medicare Tax” in the search
box.
$1,900 test. If you pay a household employee $1,900 or
more in cash wages during 2015, you must report and pay social security and Medicare taxes on all the wages. The test applies to cash wages paid in 2015 regardless of when the wages
were earned. See Pub. 926 for more information. Or, visit the
SSA's website at www.socialsecurity.gov/pubs/10021.html.

The FUTA tax rate is 6.0% (.060). But see Credit for contributions paid to state below. Don't deduct the FUTA tax from
your employee's wages. You must pay it from your own funds.
Credit for contributions paid to state. You may be able to
take a credit of up to 5.4% against the FUTA tax, resulting in a
net FUTA tax rate of 0.6% (.006). But to do so, you must pay
all the required contributions for 2015 to your state unemployment fund by April 18, 2016 (April 19, 2016, if you live in
Maine or Massachusetts). Fiscal year filers must pay all required contributions for 2015 by the due date of their federal
income tax returns (not including extensions).
Contributions are payments that a state requires you, as an
employer, to make to its unemployment fund for the payment
of unemployment benefits. However, contributions don't include:
Any payments deducted or deductible from your employees' pay;
Penalties, interest, or special administrative taxes; or
Voluntary contributions you paid to get a lower state experience rate. See the instructions for line 17 for more information.
If you paid contributions to any credit reduction state, see
the instructions for line 23.
Lines 10 through 12. Answer the questions on lines 10
through 12 to see if you should complete Section A or Section B of Part II.

Line 1. Enter on line 1 the total of cash wages (see Cash wages, earlier) paid in 2015 to each household employee who
meets the $1,900 test, explained earlier.

CAUTION

If you paid any household employee cash wages of
more than $118,500 in 2015, include on line 1 only
the first $118,500 of that employee's cash wages.

Line 2. Multiply the amount on line 1 by 12.4% (.124) and
enter the result on line 2.
Line 3. Enter on line 3 the total of cash wages (see Cash wages, earlier) paid in 2015 to each employee who meets the
$1,900 test. There is no limit on wages subject to the Medicare
tax.
Line 4. Multiply the amount on line 3 by 2.9% (.029) and enter the result on line 4.
Line 5. Enter on line 5 the total cash wages (see Cash wages,
earlier) paid to each employee in 2015 that exceeded $200,000.
Line 6. Multiply the amount on line 5 by 0.9% (.009) and enter the result on line 6.
Line 7. Enter on line 7 any federal income tax you withheld
from the wages you paid to your household employees in 2015.
See Pub. 926 and Pub. 15 for information on withholding federal income taxes.
Line 8. Add lines 2, 4, 6, and 7 and enter the result on line 8.
Line 9. Review the cash wages you paid to all your household
employees for each calendar quarter of 2014 and 2015. Is the
total for any quarter in 2014 or 2015 $1,000 or more?
Yes. Complete Schedule H, Part II.
No. Follow the instructions in the chart below.

Fiscal year filers. If you paid all state unemployment contributions for 2015 by the due date of your return (not including extensions), check the “Yes” box on line 11. Check the
“No” box if you didn't pay all of your state contributions by the
due date of your return.
Line 13. Enter the two-letter abbreviation of the name of the
state (or the District of Columbia, Puerto Rico, or the U.S. Virgin Islands) to which you paid unemployment contributions.
Line 14. Enter the total of contributions (defined earlier) you
paid to your state unemployment fund for 2015. If you didn't
have to make contributions because your state gave you a zero
percent experience rate, enter “0% rate” on line 14.

H-5

If you were given a rate for only part of the year, or the rate
changed during the year, you must complete a separate line for
each rate period.

Line 15. Enter the total of cash wages (see Cash wages, earlier) you paid in 2015 to each household employee, including
employees paid less than $1,000. However, don't include cash
wages paid in 2015 to any of the following individuals.
Your spouse.
Your child who was under age 21.
Your parent.
If you paid any household employee more than $7,000 in
2015, include on line 15 only the first $7,000 of that employee's cash wages.
Credit for 2015. The credit you can take for any state unemployment fund contributions for 2015 that you pay after April
18, 2016 (April 19, 2016, if you live in Maine or Massachusetts) is limited to 90% of the credit that would have been allowable if the contributions were paid on or before April 18,
2016 (April 19, 2016, if you live in Maine or Massachusetts).

Column (b). Enter the taxable wages on which you must
pay taxes to the unemployment fund of the state shown in column (a). If your experience rate is zero percent, enter the
amount of wages you would have had to pay taxes on if that
rate hadn't been granted.
Column (h). Enter the total contributions (defined earlier)
you paid to the state unemployment fund for 2015 by April 18,
2016 (April 19, 2016, if you live in Maine or Massachusetts).
Fiscal year filers, enter the total contributions you paid to the
state unemployment fund for 2015 by the due date of your return (not including extensions). If you are claiming excess
credits as payments of state unemployment contributions, attach a copy of the letter from your state.
Line 18. Add the amounts in columns (g) and (h) separately
and enter the totals in the spaces provided.
Line 19. Add the amounts shown on line 18 and enter the total on line 19.
Line 20. Enter the total cash wages subject to FUTA tax. See
the line 15 instructions for details.
Line 21. Multiply the wages on line 20 by 6.0% (.060). Enter
the result on line 21.
Line 22. Multiply the wages on line 20 by 5.4% (.054). Enter
the result on line 22.
Line 23. Complete the Worksheet for Household Employers in
a Credit Reduction State—Line 23 in these instructions only if
you are a household employer in any of the credit reduction
states. A state is a credit reduction state if the amount in the
“Reduction Rate” column for the state in the worksheet is
greater than zero.

Use Worksheet A in Pub. 926 to figure the credit for
late contributions if you paid any state contributions
after the due date for filing Form 1040.
Line 16. Multiply the wages on line 15 by .6% (.006). Enter
the result on line 16.

Complete lines 17 through 24 only if you checked a
“No” box on lines 10, 11, or 12.

CAUTION

Line 17. Complete all columns that apply. If you don't, you
won't get a credit. If you need more space, attach a statement
using the same format as line 17. Your state will provide the
experience rate. If you don't know your rate, contact your state
unemployment tax agency.
You must complete columns (a), (b), and (h), even if you
weren't given an experience rate. If you were given an experience rate of 5.4% or higher, you must also complete columns
(c) and (d). If you were given a rate of less than 5.4%, you
must complete all columns.
State Names and Postal Abbreviations
State

Postal
Abbreviation

State

Alabama

Indiana

Alaska

Arizona

Arkansas
California

Postal
Abbreviation

State

Postal
Abbreviation

State

Postal
Abbreviation

Nevada

Tennessee

Iowa

New Hampshire

Texas

Kansas

New Jersey

Utah

Kentucky

New Mexico

Vermont

Louisiana

New York

Virginia

Colorado

Maine

North Carolina

Washington

Connecticut

Maryland

North Dakota

West Virginia

Delaware

Massachusetts

Ohio

Wisconsin

District of Columbia

Michigan

Oklahoma

Wyoming

Florida

Minnesota

Oregon

Puerto Rico

Georgia

Mississippi

Pennsylvania

U.S. Virgin Islands

Hawaii

Missouri

Rhode Island

Idaho

Montana

South Carolina

Illinois

Nebraska

South Dakota

H-6

Worksheet for Household Employers in a Credit Reduction State—Line 23
1. Enter the smaller of the amount from Schedule H, line 19 or line 22

Keep for Your Records

...............................

2. Enter the total taxable FUTA wages from Schedule H, line 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3. Place an “X” in the box of EVERY state in which you had to pay state unemployment tax this year. If all of the states you check have a credit
reduction rate of zero, don't enter an amount on line 23. For each state with a credit reduction rate greater than zero, enter the FUTA taxable wages,
multiply by the reduction rate, and then enter the credit reduction amount. Don't include in the FUTA Taxable Wages box wages that were excluded
from state unemployment tax. If any states don't apply to you, leave them blank.
Postal Abbreviation

FUTA Taxable
Wages

Reduction
Rate

Credit Reduction

Postal Abbreviation

FUTA Taxable
Wages

Reduction
Rate

Credit Reduction

x .000

x .015

x .000

x .021

x .000

x .015

x .000

x .015

x .000

4. Total Credit Reduction. Add all amounts shown in the Credit Reduction boxes. Enter the total here. . . . . . . . .

5. Subtract line 4 of this worksheet from line 1 of this worksheet and enter the result here and on Schedule H,
line 23.

Part III. Total Household Employment Taxes

Line 26. Add the amounts on lines 16 and 25. If you were required to complete Section B of Part II, add the amounts on
lines 24 and 25 and enter the total on line 26.
Line 27. Follow the instructions in the chart.

Line 25. Enter the amount from line 8. If there is no entry on
line 8, enter -0-.

H-7

If you file
Form. . .

Then don't complete Part IV but
enter the amount from Schedule H,
line 26, on . . .

1040

line 60a

1040NR

line 59a

1040-SS

Part I, line 4

1041

Schedule G, line 6

hold employment taxes shown on Schedule H, line 26. You
may increase your federal income tax withheld by giving your
employer a new Form W-4, or by giving the payor of your pension a new Form W-4P. Make estimated tax payments by filing
Form 1040-ES, Estimated Tax for Individuals. For more information, see Pub. 505.
Estimated tax payments must be made as the tax liability is incurred: by April 15, 2015, June 15, 2015,
CAUTION
September 15, 2015, and January 15, 2016. If you file
your Form 1040 by February 1, 2016, and pay the rest of the
tax that you owe with the form, you don't need to make the payment due on January 15, 2016.

If you don't file any of the above forms, complete Schedule H,
Part IV and follow the instructions under When and Where To
File.

Paid Preparers

Exception. You won't be penalized for failure to make estimated tax payments if both 1 and 2 below apply for the year.
1. You won't have federal income tax withheld from wages, pensions, or any other payments you receive.
2. Your income taxes, excluding your household employment taxes, wouldn't be enough to require payment of estimated taxes.

Paid preparer use only. You must complete this part if you
were paid to prepare Schedule H, and aren't an employee of the
filing entity, and aren't attaching Schedule H to Form 1040,
1040NR, 1040-SS, or Form 1041. You must sign in the space
provided and give the filer a copy of the return in addition to
the copy to be filed with the IRS.

Form W-2 and Form W-3

What Records To Keep

If you file one or more Forms W-2, you must also file Form
W-3.

You must keep copies of Schedule H and related Forms W-2,
W-3, and W-4 for at least 4 years after the due date for filing
Schedule H or the date the taxes were paid, whichever is later.
If you have to file Form W-2, also keep a record of each employee's name and SSN. Each payday, you should record and
keep the dates and amounts of:
Cash and noncash wage payments,
Any employee social security tax withheld,
Any employee Medicare tax withheld, and
Any federal income tax withheld.

You must report both cash and noncash wages in box 1, as
well as tips and other compensation. The completed Forms
W-2 and W-3 in the example (in these instructions) show how
the entries are made. For detailed information on preparing
these forms, see the General Instructions for Forms W-2 and
W-3.
Employee's portion of taxes paid by employer. If you paid
all of your employee's share of social security and Medicare
taxes, without deducting the amounts from the employee's pay,
the employee's wages are increased by the amount of that tax
for income tax withholding purposes. Follow steps 1 through 3
below. (See the example in these instructions.)
1. Enter the amounts you paid on your employee's behalf
in boxes 4 and 6 (don't include your share of these taxes).
2. Add the amounts in boxes 3, 4, and 6. (However, if
box 5 is greater than box 3, then add the amounts in boxes 4, 5,
and 6.)
3. Enter the total in box 1.

TIP

What Is the Earned Income Credit
(EIC)?
The EIC is a refundable tax credit for certain workers.
Which employees must I notify about the EIC? You must
notify your household employee about the EIC if you agreed to
withhold federal income tax from the employee's wages but
didn't do so because the income tax withholding tables showed
that no tax should be withheld.
Note. You are encouraged to notify each employee whose
wages for 2015 were less than $47,747 ($53,267 if married filing jointly) that he or she may be eligible for the EIC for 2015.
How and when must I notify my employees? You must give
the employee one of the following items.
The official IRS Form W-2, which has the required information about the EIC on the back of Copy B.
A substitute Form W-2 with the same EIC information on
the back of the employee's copy that is on Copy B of the official IRS Form W-2.
Notice 797, Possible Federal Tax Refund Due to the
Earned Income Credit (EIC).
Your written statement with the same wording as Notice
797.

On Form W-3, put an “X” in the “Hshld. emp.” box
located in box b, Kind of Payer.

For information on filing Forms W-2 and W-3 electronically, visit the SSA's Employer W-2 Filing Instructions & Information website at www.socialsecurity.gov/employer.

You Should Also Know
Estimated Tax Penalty
You may need to increase the federal income tax withheld from
your pay, pension, annuity, etc., or make estimated tax payments to avoid an estimated tax penalty based on your house-

H-8

If you aren't required to give the employee a Form W-2, you
must provide the notification by February 8, 2016.
If the notification isn't given on Form W-2 in a timely manner, you must hand the notice directly to the employee or send
it by First-Class Mail to the employee's last known address.
How do my employees claim the EIC? Eligible employees
claim the EIC on their 2015 tax returns.

Completed Examples of
Schedule H, Form W-2, and Form
W-3
On February 12, 2015, Susan Green hired Helen Maple to
clean her house every Wednesday. Susan didn't have a household employee in 2014 and had no household employees other
than Helen during 2015.

Rules for Business Employers
Don't use Schedule H if you chose to report employment taxes
for your household employees along with your other employees on Form 941, Employer's QUARTERLY Federal Tax Return; Form 943, Employer's Annual Federal Tax Return for
Agricultural Employees; or Form 944, Employer's ANNUAL
Federal Tax Return. If you report this way, be sure to include
your household employees' wages on your Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return.

Susan paid Helen $50 every Wednesday for her day's work.
Susan decided not to withhold Helen's share of the social security and Medicare taxes from the wages she paid Helen. Instead, she will pay Helen's share of these taxes from her own
funds. Susan didn't withhold federal income tax because Helen
didn't give her a Form W-4 to request withholding and no withholding is otherwise required.

State Disability Payments

Helen was employed by Susan for the rest of the year (a total of 46 weeks). The following is some of the information Susan will need to complete Schedule H, Form W-2, and Form
W-3.

Certain state disability plan payments to household employees
are treated as wages subject to social security and Medicare
taxes. If your employee received payments from a plan that
withheld the employee's share of social security and Medicare
taxes, include the payments on lines 1 and 3 of Schedule H and
complete the rest of Part I through line 7. Add lines 2, 4, 6, and
7. From that total, subtract the amount of these taxes withheld
by the state. Enter the result on line 8. Also, enter “disability”
and the amount subtracted on the dotted line next to line 8. See
the notice issued by the state for more details.

Helen's total cash wages . . . . . . . .
Helen's share of the:
Social security tax . . . . . .
Medicare tax . . . . . . . . .

How To Correct Schedule H

Helen's total cash wages each quarter:
1st quarter . . . . . . . . . .
2nd quarter . . . . . . . . .
3rd quarter . . . . . . . . . .
4th quarter . . . . . . . . . .

If you discover an error on a Schedule H that you previously
filed with Form 1040, Form 1040NR, or Form 1040-SS, file
Form 1040X, Amended U.S. Individual Income Tax Return,
and attach a corrected Schedule H. If you discover an error on
a Schedule H that you previously filed with Form 1041, file an
“Amended” Form 1041 and attach a corrected Schedule H.
If you discover an error on a Schedule H that you filed as a
stand-alone return, file another stand-alone Schedule H with
the corrected information. In the top margin of your corrected
Schedule H write (in red ink if possible) “CORRECTED” followed by the date you discovered the error.
If you owe tax, pay in full with your Form 1040X, Form
1041, or stand-alone Schedule H. If you overpaid tax on a previously filed Schedule H, then depending on whether you adjust or claim a refund, you must certify that you repaid or reimbursed the employee's share of social security and Medicare
taxes, or that you have obtained consents from your employees
to file a claim for refund for the employee tax. See Pub. 926 for
complete instructions.

$2,300.00
($50 x 46 weeks)
$142.60
($2,300 x 6.2% (.062))
$33.35
($2,300 x 1.45% (.0145))
$350.00 ($50 x 7 weeks)
$650.00 ($50 x 13 weeks)
$650.00 ($50 x 13 weeks)
$650.00 ($50 x 13 weeks)

Amount included in box 1 of Form W-2 and Form W-3:
Cash wages . . . . . . . . . . . . . . . . . . . . . . .
Helen's share of social security tax paid by
Susan . . . . . . . . . . . . . . . . . . . . . . . . . .
Helen's share of Medicare tax paid by Susan . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . .

$2,300.00
142.60
33.35
$2,475.95

Because Susan paid less than $1,000 per quarter to household employees during 2014 (no employees) and 2015 (see
above), she isn't liable for FUTA tax.
See Pub. 926 for an example showing how to complete Forms W-2 and W-3 if the employer withheld
social security and Medicare taxes from the employee's wages.

TIP

How To Get Forms and Publications
To get the IRS forms and publications mentioned in these instructions (including Notice 797), visit www.irs.gov/formspubs.

H-9

Household Employment Taxes

SCHEDULE H
(Form 1040)
Department of the Treasury
Internal Revenue Service (99)

OMB No. 1545-1971

(For Social Security, Medicare, Withheld Income, and Federal Unemployment (FUTA) Taxes)
▶

▶ Attach to Form 1040, 1040NR, 1040-SS, or 1041.
Information about Schedule H and its separate instructions is at www.irs.gov/scheduleh.

2015

Attachment
Sequence No. 44
Social security number

Name of employer

001-11-1111
Employer identification number

Susan Green

0 0 1 2 3 4 5 6 7

Calendar year taxpayers having no household employees in 2015 do not have to complete this form for 2015.
A Did you pay any one household employee cash wages of $1,900 or more in 2015? (If any household employee was your
spouse, your child under age 21, your parent, or anyone under age 18, see the line A instructions before you answer this
question.)
√

Part I

Yes. Skip lines B and C and go to line 1.
No. Go to line B.

Social Security, Medicare, and Federal Income Taxes

1 Total cash wages subject to social security tax .

2 Social security tax. Multiply line 1 by 12.4% (.124) .

3 Total cash wages subject to Medicare tax .

1
.

4 Medicare tax. Multiply line 3 by 2.9% (.029) .

5 Total cash wages subject to Additional Medicare Tax withholding .

6 Additional Medicare Tax withholding. Multiply line 5 by 0.9% (.009)

7 Federal income tax withheld, if any .

2,300

285

351

8 Total social security, Medicare, and federal income taxes. Add lines 2, 4, 6, and 7 .

.
5

9 Did you pay total cash wages of $1,000 or more in any calendar quarter of 2014 or 2015 to all household employees?
(Do not count cash wages paid in 2014 or 2015 to your spouse, your child under age 21, or your parent.)
√ No. Stop. Include the amount from line 8 above on Form 1040, line 60a. If you are not required to file Form 1040, see

the line 9 instructions.

H-10

Note: Although not shown, Susan also enters on Form W-2 the
required state or local income tax information in boxes 15
through 20.
22222

a Employee’s social security number

Void

For Official Use Only
OMB No. 1545-0008

000-00-4567

b Employer identification number (EIN)

Visit the SSA website at www.socialsecurity.gov/employer to
file Copy A of Form W-2 electronically.
▶

1 Wages, tips, other compensation

2 Federal income tax withheld

2475.95

00-1234567

c Employer’s name, address, and ZIP code

3 Social security wages

4 Social security tax withheld

2300.00

Susan Green
16 Gray Street
Anyplace, CA 92665

142.60

5 Medicare wages and tips

6 Medicare tax withheld

2300.00

33.35

7 Social security tips

d Control number

8 Allocated tips

e Employee’s first name and initial

Suff. 11 Nonqualified plans

Last name

Helen R.

10 Dependent care benefits

Maple

19 Pine Avenue
Anycity, CA 92666

Statutory
employee

12a See instructions for box 12
C
o
d
e

Retirement
plan

Third-party
sick pay

12b
C
o
d
e

14 Other

12c
C
o
d
e

12d
C
o
d
e

f Employee’s address and ZIP code
15 State

Form

16 State wages, tips, etc.

Employer’s state ID number

W-2

17 State income tax

18 Local wages, tips, etc.

2015

Wage and Tax Statement

a Control number

20 Locality name

Department of the Treasury—Internal Revenue Service
For Privacy Act and Paperwork Reduction
Act Notice, see the separate instructions.

Copy A For Social Security Administration — Send this entire page with
Form W-3 to the Social Security Administration; photocopies are not acceptable.

33333

19 Local income tax

Cat. No. 10134D

For Official Use Only ▶
OMB No. 1545-0008

Kind
of
Payer

941

Military

CT-1

Hshld.
emp.

(Check one)

✗

943

944

Medicare
govt. emp.

None apply

501c non-govt.

State/local
non-501c

State/local 501c

Third-party
sick pay
(Check if
applicable)

Federal govt.

(Check one)
1 Wages, tips, other compensation

2 Federal income tax withheld

e Employer identification number (EIN)

3 Social security wages

4 Social security tax withheld

f Employer’s name

5 Medicare wages and tips

6 Medicare tax withheld

7 Social security tips

8 Allocated tips

c Total number of Forms W-2

d Establishment number

Kind
of
Employer

00-1234567

Susan Green
16 Gray Street
Anyplace, CA 92665

2475.95
2300.00

142.60

2300.00

33.35

10 Dependent care benefits

9
11 Nonqualified plans

12a Deferred compensation

g Employer’s address and ZIP code
h Other EIN used this year

13 For third-party sick pay use only

15 State

14 Income tax withheld by payer of third-party sick pay

Employer’s state ID number

16 State wages, tips, etc.

17 State income tax

18 Local wages, tips, etc.

Employer's contact person

Employer's telephone number

Employer's fax number

Employer's email address

12b

19 Local income tax

(123) 456-7890

For Official Use Only

Under penalties of perjury, I declare that I have examined this return and accompanying documents and, to the best of my knowledge and belief, they are true, correct, and
complete.
Signature ▶
Form

W-3

Date ▶

Title ▶

Transmittal of Wage and Tax Statements

Note: When you fill in Forms W-2 and W-3, please—
• Type entries using black ink.
• Enter all money amounts without the dollar sign and comma, but
with the decimal point (for example, 2475.95 not $2,475.95).

H-11

2015

1/29/16
Department of the Treasury
Internal Revenue Service

• Do not round money amounts—show the cents portion.

Privacy Act and Paperwork Reduction Act Notice
We ask for the information on this form to carry out the Internal Revenue laws of the United States. You are required to give us the
information. We need it to ensure that you are complying with these laws and to allow us to figure and collect the right amount of
tax. If you don't provide the information we ask for, or provide false or fraudulent information, you may be subject to penalties.
You aren't required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the
form displays a valid OMB control number. Books or records relating to a form or instructions must be retained as long as their
contents may become material in the administration of any Internal Revenue law.
Subtitle C, Employment Taxes, of the Internal Revenue Code imposes employment taxes on wages and provides for income tax
withholding. This form is used to determine the amount of the taxes that you owe. Section 6011 requires you to provide the requested information if the tax is applicable to you. Section 6109 requires you to provide your identification number.
Generally, tax returns and return information are confidential, as required by section 6103. However, section 6103 allows or
requires the IRS to disclose or give the information shown on your tax return to others as described in the Code. For example, we
may disclose your tax information to the Department of Justice for civil and criminal litigation, and to cities, states, the District of
Columbia, and U.S. commonwealths and possessions to administer their tax laws. We may also disclose this information to other
countries under a tax treaty, to federal and state agencies to enforce federal nontax criminal laws, or to federal law enforcement and
intelligence agencies to combat terrorism.
The time needed to complete and file this form will vary depending on individual circumstances. The estimated burden for individual taxpayers filing this form is approved under OMB control number 1545-0074 and is included in the estimates shown in the
instructions for their individual income tax return.
The estimated burden for all other taxpayers who file this form is shown below.
Recordkeeping, 1 hr., 38 min.
Learning about the law or the form, 39 min.
Preparing the form, 1 hr.
Copying, assembling, and sending the form to the IRS, 34 min.
If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, we would
be happy to hear from you. You can send us comments from www.irs.gov/formspubs. Click on More Information and then click on
Give us feedback. Or you can send your comments to Internal Revenue Service, Tax Forms and Publications Division, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Don't send Schedule H (Form 1040) to this address. Instead, see When and
Where To File, earlier.

Do You Have To File Form 1040, 1040NR, 1040-SS, or Form 1041?
Yes — Attach Schedule H to that form and mail to the address in your tax return instructions.
No — Mail your completed Schedule H and payment to the Department of the Treasury, Internal Revenue Service, for the place
where you live. No street address is needed. See When and Where To File for the information to enter on your payment.
IF you live in...

THEN use this address...

Florida, Louisiana, Mississippi, Texas

Austin, TX 73301-0002

Alaska, Arkansas, Arizona, California, Colorado, Hawaii, Idaho, Illinois,
Indiana, Iowa, Kansas, Michigan, Minnesota, Montana, Nebraska, Nevada, New
Mexico, North Dakota, Ohio, Oklahoma, Oregon, South Dakota, Utah,
Washington, Wisconsin, Wyoming

Fresno, CA 93888-0002

Alabama, Connecticut, Delaware, District of Columbia, Georgia, Kentucky,
Maine, Maryland, Massachusetts, Missouri, New Hampshire, New Jersey, New
York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Tennessee,
Vermont, Virginia, West Virginia

Kansas City, MO 64999-0002

APO, FPO, American Samoa, the Commonwealth of the Northern Mariana
Islands, nonpermanent residents of Guam or the U.S. Virgin Islands*, Puerto
Rico, dual-status aliens, a foreign country

Austin, TX 73301-0215

* Permanent residents of Guam should use: Department of Revenue and Taxation, Government of Guam, P.O. Box 23607, GMF, GU 96921;
permanent residents of the U.S. Virgin Islands should use: USVI Bureau of Internal Revenue, 6115 Estate Smith Bay, St. Thomas, VI 00802.

H-12

File Type	application/pdf
File Title	2015 Instruction 1040 Schedule H
Subject	2015 Instructions for Schedule H (Form 1040)Household Employment Taxes, HouseholdEmployers
Author	W:CAR:MP:FP
File Modified	2015-12-23
File Created	2015-12-22