If you completed Schedule H (Household Employment Taxes), it's normal to see your balance due increase. Schedule H calculates the Social Security, Medicare, federal unemployment tax, and any other applicable employment taxes you owe as a household employer.
These taxes are added to your individual income tax return and become part of your total tax liability for the year.
How Does Schedule H Affect My Tax Return?
When Schedule H is completed:
- The household employment taxes are calculated on Schedule H.
- The tax amount flows to Schedule 2.
- Schedule 2 is then included as part of the total tax calculation on Form 1040 or Form 1040-SR.
Because the household employment tax is added to your total taxes, it may increase the amount you owe or reduce your refund.
In most cases, taxpayers do not make a separate payment for household employment taxes. Instead, the tax is paid when the individual income tax return is filed, along with any other tax due.
What If I Already Paid My Household Employment Tax?
The program automatically adds household employment taxes calculated on Schedule H to your return.
If you already made payments to the IRS for those taxes during the year, you'll need to enter those payments so you receive proper credit.
To report the payment:
- Go to Federal
- Select Payments and Estimates
- Choose Federal Estimated Tax Payments
Enter the amount you previously paid to the IRS.
Doing so ensures the payment is included in your overall tax calculation and helps prevent you from paying the same tax twice.
Keep Records of Your Payments
If you report payments that were made separately, keep documentation such as:
- IRS payment confirmations
- Cancelled checks
- Bank records
- Electronic payment receipts
The IRS may request proof that the payments were made.
Common Mistake to Avoid
Do not assume that entering Schedule H automatically accounts for payments you've already made. Schedule H calculates the tax owed, but it does not automatically know whether you previously submitted payments to the IRS.
If you've already paid any portion of the household employment tax, be sure to enter those payments under Federal Estimated Tax Payments so you receive the appropriate credit.