Q. I am looking to hire a nanny, but am not sure what to compensate them. What is the "going rate" for nannies these days?
A. Many factors such as experience, education and job responsibilities need to be considered. As well, you may now be accountable for additional fees and taxes, including California's overtime laws for domestic employees. Unfortunately, many of these issues are often overlooked, leaving some families in a financial bind. Neverland Nannies will guide you through this process to help keep things in perspective. In general, however, a good guideline would be between $500-1,000 per week, or $13-25+ per hour, for full-time employees.

Q. I have been a housekeeper for over ten years, but I feel uncomfortable negotiating my salary with a new employer. What should I do?
A. If you prefer, we can have that conversation for you. When applying for a position with us, we can discuss your job expectations, and then request a compensation and benefits package that you feel good about.

Q. What are my legal requirements as a household employer?
A. The process of hiring a household employee can often seem quite complicated. In California, if you pay your employee over $1,600 per year (for 2008), you are legally required to report your new hire to the government and submit taxes quarterly. You are responsible to withhold Medicare, Social Security and applicable taxes. While it is not required by law to withhold Federal and State income taxes from your employee's paycheck, it is highly recommended, as without such withholding, your employee may owe significant taxes at the end of the year and potentially face an underpayment penalty.

Note: It is a really good idea to clarify tax obligations in an Employment Agreement, to prevent any ill feelings or miscommunication between you and your employee.

Q. This all seems very complicated. Wouldn't it be much easier for me to provide my nanny with a 1099 at the end of the year instead?
A. A very common misconception is that nannies, or any other domestic help (such as housekeepers and personal assistants) are contractors, when indeed they are household employees. Instead, it is required by the government that you provide them with a W2 form at the end of each year.

Q. What happens if the person I hire through Neverland Nannies quits without notice?
A. Neverland Nannies provides a 90 day replacement period for part-time and full-time employees, as well as a 30 day replacement period for temporary employees hired for a maximum of ninety days of employment. You may refer to the Family/Agency Agreement for a more detailed explanation.

Q. Is okay for me to pay my employee through our company payroll?
A. This is a two-part answer. Yes, you can pay your employee through your company payroll, HOWEVER, by law, the people you employ to primarily work for you out of your home are considered a benefit to your home and not to your company, which therefore cannot be deducted as a business expense.

Q. As a household employer, am I eligible for any tax breaks?
A. If you are employing a nanny, then yes, you will either be able to benefit from a Dependent Care Account, or a tax credit. For additional information on tax incentives, you may visit LegallyNanny.com, or visit breedlove-online.com.

Q. We are considering offering Health Insurance to our Employee but aren't sure we can afford it. Where can we find more information on this?
A. Offering health insurance (full or partial contributions) is a wonderful way to attract long term employees and also allows both you and your employee to deduct it from your taxes! Our agency works with some of the health industry's most well respected agents. Feel free to give us a call and we can guide you in the right direction.

Q. The reason I am hiring someone is because I don't have enough hours in the day to get everything I need done. Is there someone who can help me with my tax obligations?
A. Neverland Nannies works with some great companies such as Breedlove & Associates and HomeWork Solutions, who specifically focuses on Household employer taxes. They can also help set up your tax accounts, submit your new hire to the government, as well as maintain the payroll for your employee(s). Alternatively, if you just want help getting started, Legally Nanny is an excellent option for one flat fee. Legally Nanny's service includes completing and submitting all initial forms on your behalf, providing an easy to use online payroll calculator so that you can complete future payrolls, drafting a comprehensive and legally enforceable employment agreement, and as well, their responsive, confidential and knowledgeable client service.

Note: The IRS has estimated that the average amount of time it takes for a household employer to fulfill the compliance process is between 50-60 hours per year. Hiring a professional company to assist you can greatly reduce your invested hours.

Q. A friend of mine and I were considering a Nanny-Share for our two children. How would we go about handling taxes?
A. In this case, both families would be considered Household Employers and are equally responsible for filing taxes. You both must notify E.D.D. of your new hire and register separate employer accounts. Because the nanny's salary is paid by both families, the government requires both parties to be accountable. In this circumstance, you may want to consider leaving your payroll up to the professionals.