Domestic Disturbance

   Today TaxMama hears from David in Texas who needs guidance. “In the past, I employed a domestic worker and filed taxes for her. I gave her a W2, and submitted a W3 to the IRS. The IRS automatically sent me employer forms and instruction booklets this year. However, this year I no longer employee such a worker. Do I need to do anything specific to inform the government that I no longer have a domestic worker?”

Hi David,

That’s a good question.

Send in the forms. Do not ignore them. Always respond to IRS letters or requests for forms.

Enter -0- in all the boxes of Form 941 -the Employer’s QUARTERLY Federal Tax Return.

On page 2, you will find Part 3, Line 18, check the box and enter the date you paid the final wages.

IRS will stop sending you the notices. See how easy that is?

You did a great job while you did have the domestic worker. Most people don’t even try. I am proud of you!

And remember, you can find answers to all kinds of questions about household workers and other tax issues, free. Where? Where else? At TaxMama.com.

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  • IRS Form 941 :: Employer’s QUARTERLY Federal Tax Return
  • 8 thoughts on “Domestic Disturbance

    1. TaxMama says:

      Hi Tom,

      I checked with someone at one of the major tax software houses. I suspect her response is in line with all providers’ policies:

      This is not true. They issue as final the forms and calculations that are available at release time, and regularly update them as they are released from the IRS to the company. These “final” forms are considered tax-compliant and can be e-filed with the IRS. The forms that were not available at the time of release/update are considered “non-final” and they cannot be e-filed until the IRS releases them to the vendors. The venfors issue them in a subsequent software update.

      Some companies send out a “get started” version of their products that contain no final forms or calculations. You can’t file anything from that set, but you can get started pro-forma-ing data.

      Her company doesn’t don’t do that unless the IRS hasn’t released certain forms (1040 is an example) by their drop-dead release dates. This has happened in the past when the first release of the product happened before the IRS issued final forms.

      No one has control over IRS scheduling and can’t force them to release forms before they’re ready to do so. The 5405 this year comes to mind. They didn’t release the form until 12/31, I believe. In past years vendors have had to wait for 2441, 8863, and other high-use forms, even into February, because of AMT.

      So rest assured that, unless the form shows a watermark saying do not file (or typed across the top), the forms are generally current.

    2. Thomas Avery Blair, EA says:

      Congratulations on the new design web site…much less cluttered, easy to use, and very professional. Really appreciate the list on the left side of the page…makes it all very easy to access by subject.

      I do have a question perhaps you might answer in this forum: A “tax tech” I know said that tax software is sold to the public well before it is ever federally tax compliant. Do you know if this is true or not?

      It makes a really big difference if the information is true!

      Respectfully,

      Thomas Avery Blair, EA

    3. TaxMama says:

      Hi Kip,

      You would think that, wouldn’t you?

      But when you file Schedule H, IRS doesn’t send out forms.

      That’s what makes me think he’s been using a Form 941 all along. hmmm

    4. Kip G. De Boer says:

      Actually, David doesn’t file Form 941 or Form 940 but Schedule H instead since his worker is a household employee and there doesn’t seem to be any box to check off or date to fill-in for the final wages on Sch H.

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    6. Wayne Davies says:

      I would add on word to TaxMama’s comment: IRS will stop sending you the notices….eventually. I’ve had clients who have done exactly what TaxMama recommends above, only to continue to receive the forms. As long as they do, keep filing the forms with zeros. Eventually, the forms will stop coming, but not necessarily after the first try.

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