If you need to understand Virginia household employer withholding obligations, you’re in the right place. Paying a household employer tax, also known as a nanny tax, can be very confusing. It may seem straightforward at first – after all, paying just a few people consistently should be easy, right? – but you’ll need to consider federal and state filing forms, tax withholdings, salary vs. hourly wages, and untraditional employee benefit packages. After hours of doing the wrong calculations, you’ll come to see how a payroll calculator is a great choice for Virginians with household employees. First, though, you’ll need to understand the tax itself.
Understanding the Virginia Household Employer Withholding Tax
Generally, employers who pay wages to employees in the state of Virginia are required to deduct and withhold state income tax from those wages. To do this, you will need to register for withholding tax, file income tax withholding returns, and pay the income tax to Virginia.
However, Virginia makes it a bit easier for household employers. Some individuals are able to file and pay the Virginia household employer withholding tax on an annual basis, at the same time they submit employee W-2 forms for the year. To qualify, your employees must consist exclusively of domestic service in the private home of the employer.
If you qualify for the annual filing, you will need to complete Form R-1H, or the Virginia Household Employer Registration Form. This short form takes just a few minutes, but it is essential to properly filing the Virginia household employer withholding tax.
How Can Software Help?
If you employ only a few household employees, you might be skeptical of a software tool’s necessity. However, this type of payroll software does a lot more than perform pay calculations. A payroll product, like that offered from AMS, saves and aggregates data on a quarterly and annual basis to comply with filing form requirements, streamlining the process and reducing your work to simple data input. Furthermore, AMS Payroll ($129), one of our most popular tools, offers both Live and After-the-Fact payroll processing, which is important for household employees with untraditional work days. You’ll have space for over 40 user-defined fields, such as additions and deductions, and the ability to print checks right from the software. Though you might not use it as much as a full-blown business, this type of payroll product is sure to save you both time and money.
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AMS products also provide a wide range of Virginia-specific support, including various wage listings, returns, and vouchers. If you don’t find the help you need, our customer support is always ready to give you a hand.
More About AMS
If you’re unsure your Virginia household employer taxes warrant a payroll software, check out our free demo. This is a great way to determine whether our tool is a good fit for your needs. If you have any additional questions, we recommend contacting our Sales and Information team at 800-536-1099. Whether you need help with Form R-1H or would like advice on your payroll situation, our customer support team is ready to help.