Wednesday, February 20, 2008

Hiding From Uncle Sam

California, 1995--Governor Pete Wilson disclosed today that he had employed three part-time housecleaners whose Social Security taxes he failed to pay. He also said that he had made good on the missing Social Security payments by forwarding checks to the Social Security Administration, with back interest and assessed penalties.

"I have never intentionally failed to make necessary Social Security payments," the Governor declared. "But I take full responsibility for these oversights and have satisfied my obligations to Social Security."

The total in back payments was about $15,000!

The year was 1995. But the premise remains the same today. It is your responsibility to pay all federal payroll taxes if you employ an individual housecleaner.

Of course, professional cleaning companies take care of this chore for you. Or do they?

The cleaning industry is marred with unethical, unprofessional "cleaning companies". Just because your cleaning company has a business card doesn't mean that it's really a business. And just because they tell you that all payroll taxes are being paid doesn't mean that all payroll taxes are being paid. And just because you think that all payroll taxes are being paid doesn't mean that you're off the hook if they aren't being paid.

It's still your responsibility. But don't fret. There's one fool proof way to determine if your cleaning company is paying its fair share. Just ask one of their employees this simple question:

Does your employer deduct anything from your check?

No need to get technical. No need to even call the deductions payroll taxes. Because if the answer is no, then your cleaning company isn't paying any payroll taxes. And you owe the government some money.


  1. Anonymous5:45 PM

    Ooops, you forgot to mention unless theyre being paid on a 1099-misc!

  2. Anonymous7:09 PM