Household employees, also referred to as "domestic service workers," work in or around a private home of the person by whom they are employed ("the household employer") or in or around the club rooms or house of a local college club or local chapter of a fraternity or sorority. Examples of household employees include nannies, cooks, maids, babysitters, gardeners, and handymen.
(For further information on withholding see also, IP 2018(1), Circular CT, Connecticut Employer's Tax Guide)
Income Tax Withholding from the Wages of Household Employees is Voluntary: A household employer is not required to withhold Connecticut income tax from the wages of household employees but may do so voluntarily by agreement between the employer and the employee.
How to Register to Withhold Connecticut Income Tax: A household employer who agrees to withhold Connecticut income tax must register with DRS for withholding by submitting a completed Form REG-1. Complete Sections 1-6 and Section 7 (Withholding). Household employers will be set up as annual filers. (See "How to Withhold and Remit Tax", below.)
How to Withhold and Remit Tax:
Have the employee complete Form CT-W4.
Use the information on that form with the Connecticut withholding tables to determine how much to withhold from your employee's wages.
File the special version of Form CT-941(DRS/P) (for household employers) on or before April 15 following the year in which the wages were paid. Remit the taxes withheld during the prior year with Form CT-941(DRS/P). (If you are registered with DRS as a household employer, you will be mailed a CT-941(DRS/P) for household employer in January.) (The CT-941 form may also be filed electronically using the TSC.)
Annual Reporting Requirements for All Household Employers:
Every household employer, whether or not registered with DRS for Connecticut income tax withholding purposes and whether or not having withheld Connecticut income tax from the wages of household employees, is required to file Form CT-W3. Form CT-W3 is due on or before the last day of the February following the calendar year during which Connecticut wages were paid to household employees. The employer is required to attach to Form CT-W3 every "state copy" of federal Form W-2 reporting Connecticut wages paid during the calendar year.