CDSS offers clarification on this year’s W-2

A lot of IHSS providers have noticed that our 2017 W-2s don’t look quite right—or at least don’t look the same as last year. Many of us are concerned that our W-2s contain errors that could cause us big headaches—or cost money—when we file our taxes.

But now we can breathe easier! According to the California Department of Social Services (CDSS), there is no epidemic of incorrect W-2s. Instead, your W-2 may look very different than last year because live-in caregivers are able to file a form exempting our caregiver wages from taxes. This change is making many family providers’ W-2s look very different this year.

If you are worried about your W-2, here are a few things you should know:

  • If you are a family provider who will filled out a Live-In Self Certification Form SOC 2298 last year, you will show no income or partial income in box 1 for federal wages and box 16 for state wages. Any wages paid to live-in providers after filling out a SOC 2298 form are not reported as wages.
  • Year-to-date totals on W-2s may not match your paystub for the second half of December. For example: if your timesheet was processed on December 27, 2017 and the payment was made on January 2, 2018, those wages will not appear on your 2017 W-2.
  • The SOC 2298 only applies to federal and state taxes, so if you are subject to FICA taxes, your full wages for the year will be reported in box 3 (Social Security wages) and box 5 (Medicare wages and tips) on the W-2 form.

After getting reports about the W-2 confusion from providers and our union, CDSS has been reviewing each case where a provider is reporting an error on their W-2 and has found no discrepancies.

You can get more information about the live-in provider exemption at: http://www.udwa.org/2016/03/important-tax-update-for-ihss-providers-who-live-with-their-clients-irs-notice-2014-7/

Please note: this material is for informational purposes only and is not intended to replace the advice of a qualified tax advisor or accountant. All decisions regarding the tax implications of this information should be made with the consultation of your independent tax advisor.

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