Pay your nanny the right way
Hiring a nanny or caregiver? You're now a household employer. PAYHROLL makes it easy to pay them legally, handle taxes, and avoid IRS headaches.
Why pay your nanny legally?
Paying under the table might seem easier, but it comes with real risks.
Avoid IRS Penalties
The 'nanny tax' is real. Pay correctly and avoid fines, back taxes, and interest.
Protect Your Nanny
Legal pay means Social Security, unemployment benefits, and workers' comp coverage.
Tax Deductions
You may qualify for the Child and Dependent Care Tax Credit - up to $6,000/year.
Background Checks
Many background check services require proof of legal employment.
Peace of Mind
Sleep better knowing you're doing right by your caregiver and the law.
Professional Relationship
Paystubs and proper documentation create a professional employer relationship.
How it works
Three simple steps to paying your nanny legally
Add your nanny
Enter their basic info - name, pay rate, and start date. We'll handle the tax setup.
Run payroll
Each pay period, enter hours (or we auto-calculate for salary). Review and submit.
We handle the rest
Direct deposit goes out, taxes are filed, and paystubs are generated automatically.
Everything you need as a household employer
We handle the complicated stuff so you can focus on your family.
- Automatic federal & state tax calculations
- Quarterly and annual tax filings
- W-2 generation at year end
- Direct deposit to your nanny's bank
- Professional paystubs
- Time-off tracking
- Employee portal for your nanny
- Email reminders before payday
Sample Pay Schedule
We calculate all taxes automatically based on your location.
“I was so stressed about paying our nanny correctly. Tax forms, withholding, quarterly filings - it was overwhelming. PAYHROLL made it all automatic. Now I just click a button every two weeks.”
Jennifer L.
Mom of two, California
Common questions
When do I need to pay nanny taxes?
If you pay a household employee $2,700 or more in a year (2026 threshold), you're required to withhold and pay Social Security and Medicare taxes. Many states have additional requirements.
What's the difference between a nanny and a babysitter?
It's mainly about regularity. An occasional babysitter is typically not an employee. But if someone works for you regularly (even part-time), they're likely a household employee.
Can I just pay my nanny as a contractor?
Almost never. The IRS is very clear: if you control when, where, and how the work is done, they're an employee - not a contractor. Misclassifying can result in penalties.
Do I need an EIN (Employer ID Number)?
Yes, but it's free and easy to get from the IRS. You can apply online and get it immediately. We'll walk you through it during setup if you don't have one.
What if I've been paying under the table?
You can start paying correctly at any time. PAYHROLL can help you catch up on back payments and get compliant going forward. It's better to start now than face penalties later.
Give your nanny the paycheck they deserve
Start paying legally today. It's easier than you think.
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