We are hiring a nanny and, as far as I can tell, we’re among the 2% of families who try to do it on the books.
I would lose no sleep hiring an illegal immigrant. The immigration and work policies in this country are shameful. But I think the taxes and employment laws should be followed, illegal or legal worker.
This is partly on principle, and partly because, assuming my blog musings don’t bar me from public service forever, I’d like to have the option to work in US government one day. Nothing elected (the thought makes me throw up a little in my mouth) but possibly something in foreign policy or development one day. So it means I need to hire someone legal and do it legally.
Now, paying on the books would be easier if it were an actual equilibrium. But with no one else doing so in New York, it’s ridiculously hard to find a nanny who will even consider the legal route. But that’s not my main complaint.
For me to persuade someone to go on the books, I basically have to pay both their taxes and the employer contributions, so that they get the same take-home pay. This amounts to a 25-30% premium. But this still isn’t my main complaint. The premium hurts, and I have mixed opinions on taxing employment, but it’s not the level of taxes that frustrates me.
As far as I can tell, I need to submit taxes or withholding to at least seven different agencies at different levels of government. What if I miss one? A friend (and a blogger some of you may know) missed a minor payment to one of the seven, by accident, and got slapped with a $10,000 fine. The government should have added a little note to the bill: “Thanks again for being among the 2% who actually try to pay taxes.”
It’s sufficiently complex, and I’m sufficiently bad at accounting, that it actually makes econmic sense for me to pay hundreds of dollars a year to a firm to manage this mess. Madness.
Anyhow, unemployment rates make a little more sense to me today. Now if you’ll excuse me, I have eighteen forms to fill out over my lunch…