Future developments. The IRS has created a page on IRS.gov for information about Publication 926, at  
www.irs.gov/pub926. Information about any future developments affecting Publication 926 (such as legislation enacted after we release it) will be posted on that page.

Social security and Medicare tax for 2012. For 2012, the employee tax rate for social security is 6.2%. The employer tax rate for social security remains unchanged at 6.2%. The 2012 social security wage base limit is $110,100. In 2012, the Medicare tax rate is 1.45% each for employers and employees, unchanged from 2011. There is no wage base limit for Medicare tax.Social security and Medicare taxes apply to the wages of household employees you pay $1,800 or more in cash or an equivalent form of compensation. For more information, see Social security and Medicare wages under Social Security and Medicare Taxes, later.

FUTA tax rate for 2012. The FUTA tax rate remains unchanged at 6.0%.

Credit reduction states. A state that has not repaid money it borrowed from the federal government to pay unemployment benefits is a “credit reduction state.” The Department of Labor (DOL) determines these states. If an employer pays wages that are subject to the unemployment tax laws of a credit reduction state, that employer must pay additional federal unemployment tax. If you paid any wages that are subject to the unemployment compensation laws in any credit reduction state, your FUTA tax credit is reduced. See the Instructions for Schedule H (Form 1040) for more information.

Photographs of missing children. The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.

The information in this publication applies to you only if you have a household employee. If you have a household employee in 2012, you may need to pay state and federal employment taxes for 2012. You generally must add your federal employment taxes to the income tax that you will report on your 2012 federal income tax return.

This publication will help you decide whether you have a household employee and, if you do, whether you need to pay federal employment taxes (social security tax, Medicare tax, federal unemployment tax (FUTA), and federal income tax withholding). It explains how to figure, pay, and report these taxes for your household employee. It also explains what records you need to keep.

This publication also tells you where to find out whether you need to pay state unemployment tax for your household employee.