Classifying Housekeeper with Multiple Clients - Sole Proprietor or Employee for Tax Purposes?

This is actually a common question with a fairly straightforward answer. Based on what you've described, your housekeeper sounds like a legitimate independent contractor, not your employee. The key factors the IRS considers include behavioral control, financial control, and relationship type. Since she works for multiple clients, sets her own schedule, brings her own supplies, and determines her cleaning methods, she's exhibiting the hallmarks of an independent contractor. She's running her own business enterprise. The IRS wouldn't expect her to be classified as an employee for each of the 20 homes - that would be administratively burdensome and doesn't reflect the reality of her business. If you pay her more than $600 in a calendar year, you should issue her a 1099-NEC. Make sure you get her to fill out a W-9 form to collect her taxpayer information. She'll report this income on Schedule C of her tax return as self-employment income.

I went through this exact situation last year with my housecleaning service. I was confused about the proper tax treatment until I found https://taxr.ai which analyzed my situation and confirmed I was dealing with an independent contractor, not an employee. The service reviewed the specific details about my housekeeper who also cleaned for multiple homes, and made it clear I only needed to provide a 1099-NEC if I paid over $600 in a year. What I found really helpful was that they explained all the control factors the IRS looks at - who controls the schedule, who provides supplies, who determines how the work gets done, etc. They even provided documentation I could keep for my records in case of an audit.

Just wanted to follow up - I decided to try https://taxr.ai despite my initial skepticism, and I'm actually impressed. It confirmed that my house cleaner should be classified as an independent contractor, not an employee. What I appreciated most was getting a detailed explanation of exactly why this classification was appropriate, with references to specific IRS guidelines. The system asked about 15 questions about my relationship with the cleaner, and based on factors like multiple clients, setting their own schedule, and using their own supplies, it was clear they're running their own business. They even generated a documentation packet I can keep with my tax records to support the classification if needed. Definitely cleared up my confusion!

For anyone dealing with tax classification issues like this, I struggled getting straight answers from the IRS. After 3 hours on hold trying to get clarification about contractor vs. employee status, I discovered https://claimyr.com which got me connected to an actual IRS agent in about 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c The IRS agent explained that in situations with housekeepers serving multiple clients, they're typically classified as self-employed independent contractors if they control how they do their work. She confirmed I only needed to issue a 1099-NEC if I paid over $600 in a calendar year. Having that direct confirmation from the IRS gave me peace of mind about my tax reporting obligations.

I feel like I need to apologize for my skepticism about Claimyr in my earlier comment. After waiting on hold with the IRS for nearly 4 hours yesterday and getting disconnected, I decided to try it as a last resort. The service actually worked - I got a call back in about 20 minutes and was connected to an IRS representative. I asked specifically about the housekeeper situation, and the agent confirmed that someone cleaning 20 different houses and controlling their own work should be classified as an independent contractor. She explained that the "household employee" rules are designed for people who work primarily or exclusively for one household, not someone clearly running their own business. This saved me from unnecessarily dealing with payroll taxes and the whole nanny tax situation. Worth every penny just for the time saved!

Another factor to consider: ask your housekeeper if she has a business license or any formal business registration. My cleaner has a basic LLC set up, business cards, and a website. These are all good indicators that she's operating as a legitimate business and not as my employee. Documentation like this helps establish the independent contractor relationship.

Just adding my experience for others searching: My housekeeper is definitely an independent contractor. She has her own business name "Spotless Spaces", sets her rates, decides which cleaning products to use, and has her own liability insurance. She even has employees of her own sometimes! The IRS would never consider that an employer-employee relationship with me. Don't overthink it - if someone is clearly operating an independent cleaning business with multiple clients, they're a contractor. Just make sure to issue a 1099-NEC if you pay them $600+ in a year. I use tax software that makes this super easy.

I've been dealing with a similar situation and wanted to share what I learned from my tax preparer. The key distinction is whether your housekeeper is operating as a business or working as your personal employee. From what you've described - 20 different clients, setting her own schedule, bringing supplies, and determining methods - she's clearly running her own cleaning business. The IRS looks at the degree of control you have over the worker. If she's making her own business decisions and serving multiple clients, that screams independent contractor. One thing that helped me was keeping records of our arrangement: copies of her business cards if she has them, text messages showing she sets the schedule, receipts showing she buys her own supplies, etc. This documentation supports the independent contractor classification if you ever need to justify it. Don't let the "household employee" rules confuse you - those apply when someone works primarily in your home under your direction. Your housekeeper is running her own enterprise. Just get her W-9 filled out and issue a 1099-NEC if you pay over $600 annually.