Live In Nanny Room And Board Deduction

How do you figure her room and board for tax purposes.

Live in nanny room and board deduction.

If you provide free lodging or free board and lodging to an employee the employee receives a taxable benefit. Employing a live in nanny can oftentimes be a little confusing. As a result you have to add to the employee s salary the. You may give your employee board and lodging which means that you provide them with accommodations and in some cases food.

In general the internal revenue service see 119 a allows you to exclude from income the value of meals and lodging furnished by the employer when hiring a live in nanny or household worker nanny room and board provided the following conditions are met. Live in nannies need their own personal space too. A live in nanny should receive the same rate of pay you would consider for a live out caregiver. Room board deductions by living with you and eating meals with your family your nanny is saving considerable sums that she would otherwise need to spend on rent and groceries.

If you provide only meals to an employee see overtime meals or allowances and subsidized meals. Many parents think that because a live in nanny is receiving free room and board they can pay their nanny less by deducting room and board from their nanny s monthly income or pay them a lower hourly rate or simply have their nanny work in exchange for room and board. According to the international nanny association s 2017 salary and benefits survey the national average hourly rate for a full time nanny is 19 14 hour. The fact that they receive room and board shouldn t lessen their pay.

It is for this reason that families deduct room and board costs from the nanny s salary.