I'll post this here in case anyone else needs it.
KSU-Dub's Steps to Paying a Nanny Legally (In Kansas)Step 1: Get yourself an Employer Identification Number (EIN). Go to
https://sa.www4.irs.gov/modiein/individual/index.jspStep 2: Print out an I-9 (proof of legal status) for nanny to complete on first day of work.
http://www.uscis.gov/sites/default/files/files/form/i-9.pdf Just file it away for safekeeping.
Step 3: Set up an account at
www.kansasemployer.gov to pay your quarterly unemployment tax to Kansas. Call the unemployment office if you need help figuring this out (you probably will). They're very helpful and seem to understand what a pain in the ass this is for household employers to try to obey the law. Make yourself calendar reminders to pay this tax quarterly because otherwise you're going to forget. A new employer's Kansas UT is 2.7% of nanny's gross pay, but only on the first $14,000 (the taxable wage base). After that it is $0. The website will do these calculations for you, but you still need to file every quarter even if you don't owe tax.
Keep in mind, you're also going to owe federal unemployment tax of 0.6% on the first $7,000 of your nanny's gross pay. You pay this on your personal tax return (just use TurboTax or something - makes it easy).
Step 4: Decide when you're going to pay your nanny. Bi-weekly is most common. You're going to need some sort of program to record her hours, calculate the right amounts to withhold for FICA (SS and Medicare), and keep records. There are commercial services available, but I just use an excel spreadsheet I made for this purpose.
Here is a link to the one I created. You can also withhold your nanny's income tax but I don't and I don't recommend this.
To be clear: Social Security is 6.2% of nanny's gross pay, Medicare is 1.45%. You're going to owe these same matching amounts as the employer (fun!) but you obviously don't withhold your amounts from her paycheck - just her share. You pay both her share and yours on your personal return. (Again, TurboTax will do this correctly for you).
Step 5: At the start of the new year, you need to give your nanny a W-2 so she can file her own income taxes. You do this by going to
www.ssa.gov to report wages and create the W-2 for the nanny.
Step 6: As mentioned above, you pay all the SS and Medicare taxes you withheld from your nanny's wages, plus your matching share, plus the federal unemployment tax, on Schedule H of personal income tax return.
I think that covers it. You'll probably find all of this very annoying and overkill just to employ a nanny legally, but this is how you do it.