Every single person in the United States needs to pay taxes. This is not optional, and avoiding paying taxes can lead to some severe consequences. The government relies on tax revenue to fund various vital programs and services, so everyone must do their part.
Do you need to pay taxes on money earned from babysitting?
It depends on a few different factors, including how much money you made from babysitting and your other income.
If you only made a small amount of money from babysitting, likely, you won’t owe any taxes. But if you made a lot of money, you may need to pay taxes on that income. In addition, if you have other sources of income, such as a part-time job or investments, you may need to pay taxes on your total income.
Do you have to declare babysitting money?
The IRS says if you earn $2,400 or more from any family in a calendar year, and you don’t own your own business or work for an agency, that family should be withholding taxes from your pay and paying their share of taxes as well.
If you don’t earn a substantial sum from one family, you have no tax obligations toward them, and you must nevertheless include these earnings as household employment pay.
Declaring Babysitting Income: Rules To Follow
- You work for several families off and on throughout the year
You may care for ten families in a given month without paying any taxes, but you won’t have to worry about having taxes withheld from the money they pay.
You’ll just add up the total amount of money earned from all of the families you worked for at year’s end and claim it as household employment income.
- You earned $2,500 babysitting for one family this year.
Even if you’re only a little bit over the limit, the IRS requires the family to pay taxes on your earnings.
The IRS may find the family if they are not charged taxes or submit tax forms for a household employee. Being paid correctly as an employee can help you establish a reputable employment history that may be verified, which is critical for obtaining mortgages and auto loans.
Do I Have to Claim Babysitting Money on My Taxes?
There is no simple answer to this question, as it depends on various factors. Generally speaking, if you earn income from babysitting, you will need to report it on your tax return.
However, there may be some exceptions depending on the circumstances. For example, if you only babysit occasionally and it is not your primary source of income, you may not need to report it.
Speak to a tax specialist like The Oasis Firm to get specific advice for your situation.