Everyday many families are faced with the task to hire agency caregiver or a private one. Before making a decision, understand the differences between an agency caregiver and a private caregiver.
Sometimes people choose to pay their private employee “under the table”. What it means is payment by cash, check or other compensation with the intent of not paying payroll taxes. This form of payment is ILLEGAL. It is a fraud and could result in charges of Perjury or tax evasion. One could end up paying the back taxes, huge monetary penalties and interest.
When hiring a private caregiver, you are the employer and must fully understand the legal responsibilities for paying and filing taxes on your private caregiver. These include;
- State Employment Taxes
- Filing quarterly and annual tax forms with government taxing agencies
- Withholding federal income tax
- Withholding of Social Security, Medicare and FUTA taxes
- Have caregiver complete required forms for ensuring they can legally work in the United States
- Tax payments must be made to government agencies on time
- You, as the employer must keep all records for audit purposes
- Arrange insurance for caregiver in the event he/she gets injured on the job. If the caregivers gets hurt and there is no insurance, it could result in litigation and serious financial loss for you.
In this case, agency is the employer and responsible for hiring, training and supervising their employees. There are many other benefits which are listed below;
- Check personal and professional references
- Conduct comprehensive background checks
- Check Motor Vehicle Record for driving history
- Workers compensation insurance
- Drug Testing (Ask the agency if they conduct drug testing before hiring their employees and random tests throughout the year)
- General liability insurance and bonding policy against theft
- Send an alternate caregiver if primary caregiver in unavailable
- Monitor and supervise their caregivers to ensure quality care is being provided
- Track their caregivers payroll and benefits as they are the employer and not you. You don’t have to track caregiver’s hours, vacations or pay their taxes
- Appropriate State & Federal Taxes
- Policies against Abuse, Neglect and Exploitation and agencies monitor their caregivers regularly.
Contact us anytime if you have any questions or would like to know about the services we offer.