California Laws for Hiring Family Caregivers

Hiring a caregiver for a family member with a long-term illness or condition is a weighty decision. But for the loved one who requires care, daily in-home assistance may come as a blessing. In-home private care is typically the most affordable option, but when you hire an individual caregiver, the burden is on you to work out a fair contract. Knowledge of California laws on hiring caregivers is an essential step in the hiring process.

Employer Registration

• You're legally required to register as an employer with the California Employment Development Department if you hire an at-home caregiver and pay him wages totaling more than $750 in one calendar quarter. You may register online, by phone, or by mailing or faxing form DE 1HW to the department. Whichever way you register, you are required by law to do so within 15 days of hiring and paying your caregiver her wages for that quarter.

Income Withholding

• Other legal considerations deal with income withholding requirements. If you pay between $750 and $999 to your family caregiver, you must withhold state disability insurance and file a quarterly wage report. State income tax withholding is not necessary. If you pay your family caregiver more than $999 in one calendar quarter, both you and your hired caregiver owe Social Security and Medicare taxes. You will be asked to pay half the tax, and your employee pays the other half.

Tax Payments

• As an employer of an in-home caregiver, the law may require you to pay certain taxes and fees. If you pay your caregiver more than $1,000 per calendar quarter, you must pay unemployment insurance and the Employment Training Tax to the California Employment Development Department. If you pay your caregiver less than $20,000 per year, you may elect to pay annually by submitting form DE 89 to the department; otherwise, you must pay quarterly.

Employment Verification and Forms

• After selecting a caregiver and drawing up a contract, you both must file employment forms and documentation. Upon employment, your caregiver must submit an I-9 Employment Eligibility Verification Form to you. This form certifies that he is legally entitled to work in the United States. After hiring a caregiver, you'll need to file a W-2 form annually when you file for taxes, and give a copy to the caregiver for her records.