You Found the Right Person. Leave the Payroll, Taxes, and Filings to Us.
Paying your nanny above board is easier than you think and more valuable than most families realize. Our payroll specialists handle the payroll, the tax filings, and year-end forms, so you stay compliant and the person you hired has every reason to stay.
Hiring a Nanny Makes You a Household Employer.
Congrats, you’ve found your person. Along with the household support comes requirements as an employer: tax requirements, payroll regulations, and state-specific employment laws that most families don’t realize exist.
A few things worth knowing early:
Your nanny is an employee, not an independent contractor.
This isn't a gray area open to interpretation. The IRS position is that household workers are almost invariably employees of the person in whose home they work.
Hiring through an agency doesn't transfer the obligation.
IRS guidance is explicit that when a family hires through a placement agency, the household is the employer. We tell you that up front, because not every agency does.
A written agreement calling someone a contractor changes nothing.
Classification is determined by the nature of the working relationship, not by what a document says.
Paying off the books puts the exposure on you.
Unpaid employment taxes don't expire quietly. If your nanny ever files for unemployment, applies for disability, or the arrangement surfaces any other way, the back taxes, interest, and penalties are yours to bear.
The Fastest Way to Lose the Nanny You Just Hired
Pay under the table.
It starts with the best of intentions: you pay cash because it seems simpler. Your nanny is wonderful and your kids adore them. But, then they give notice—not because they were unhappy or someone else offered more money.
Your nanny tried to rent an apartment, finance a car, or qualify for a mortgage, and they cannot document a single dollar earned in your home. Cash pay leaves your nanny with no verifiable income, Social Security, and no unemployment eligibility.
How you decide to pay attracts the strongest candidates. Because the most experienced career nannies won’t accept off-books arrangements. Legal pay is the right thing to do and how you keep the person you hired.
A Household Payroll System Built for Families Like Yours
Household payroll built for families who want to get it right, without becoming experts in something they didn’t sign up to learn. Our hassle-free payroll system includes:
Full-Service Payroll
Custom hours and pay rates
Direct deposit or check
Paystubs with reimbursements and withholdings
PTO, sick leave, and overtime processing
Taxes and Reporting
Federal registrations
State account setup and new hire reporting
Quarterly federal and state tax filings
Delivery of Schedule H and W-2 forms at no additional cost
Effortless Compliance
We keep abreast of federal and state law changes so you don’t have to. This includes changes to:
Minimum wage and overtime
Paid sick time and paid family leave
State-specific household employment requirements
Employee Benefits
Small business solutions for household employers facilitating:
Workers' compensation, required in 23 states
Health insurance add-ons
401(k) retirement plans
Payroll in Three Simple Steps
We Set Everything Up
We establish your payroll, register your federal and state tax accounts, configure direct deposit, and handle new hire reporting.
We Run Payroll
Your nanny is paid on schedule through our secure, automated payroll system. Hours, rates, withholdings, and reimbursements are calculated correctly every cycle.
We Handle the Rest
We manage quarterly filings, year-end reporting, and compliance throughout the year.
If This Feels More Complicated Than It Should Be, You’re Right.
When a company hires an employee, those wages are tax-deductible. When you hire a nanny, you pay them from income you’ve already been taxed on, and then pay employer taxes on top of it. You carry the same obligations as any other employer, but then receive almost none of the same treatment or benefits.
We’re not going to describe those rules as fair (they’re not!) while we help you follow them. So we’re doing both: getting your payroll right every pay period and actively working to change the system that costs families more than it should.
That’s why Hello Nanny! founder, Stephanie Fornaro established the Workforce Infrastructure Institute (WII), a nonpartisan policy organization making the case that childcare is workforce infrastructure, not personal consumption. Change the classification and the math changes for millions of families.
That’s what you get from an agency that takes this seriously.
Learn more our advocacy work.
Let’s Get Your Payroll Set Up
Complete this short form and one of our payroll specialists will contact you to discuss your household employment needs.
Hello Nanny!® provides general education and coordination support related to household employment. Payroll services are provided by a third‑party partner and do not replace legal or tax advice. Families remain the legal employer of their household employees and retain responsibility for compliance with applicable employment laws.
