When a relative (either by blood, marriage, or adoption) of the alleged employer performs
domestic services, because of the close family relationship, it raises the question
as to whether there is an employment relationship.
Even when the parties act in good faith and report “wages” for the domestic, unless
the evidence establishes there was a true employer-employee relationship where the
relative performed services in exchange for remuneration, any amounts of cash exchanged
between the parties do not constitute “wages” for Social Security purposes. The details
of the employment are not easy to observe by outsiders because the relative generally
performed services inside the home.
Services are covered where an employment relationship exists. Exceptions are as follows:
a child aged 18 through 21 performs the service and the service is not in the course
of the employer’s trade or business, or it is domestic service in a private home of
a child under age 18 in the employ of a parent; or
an individual in the employ of a son, daughter, or spouse (see RS 01901.250 for coverage rules for family employment.
NOTE: However, domestic service by a parent in the private home of a son or daughter is
covered under special circumstances (see RS 01901.200 for coverage of domestic employment in a private home).