In addition to providing nurturing and responsible childcare, our San Diego nannies will perform light housekeeping in child-related areas of the house (child’s bedroom, playroom, family room, kitchen, laundry). Many nannies enjoy cooking or prepping a meal, as long as care of the child is the first priority. Our nannies do not perform heavy cleaning. Nannies will typically run errands, but will expect to be compensated for gas and/or mileage for these errands. A clear understanding of the nanny’s responsibilities are set forth at the time of hire.
In nearly every case, your nanny is considered a Domestic Employee, and you are considered a Household Employer. According to the IRS, if you pay cash wages of $1,400 or more in a year to your nanny, you are required to pay employment taxes on those wages. Take a look at IRS Publication 926 (Household Employer’s Tax Guide) — it explains everything you need to do.
GTM Payroll Services Wage and Tax Calculator provides a number of tools and calculators to help you with the tasks of paying a nanny and dealing with payroll taxes.
As a Household Employer, you also have tax obligations to the State of California Employee Development Department. Follow this link to the Employee Development Department to learn about these obligations.
Many of our families choose to meet their obligations to the IRS and the State of California by using a payroll service to process their nanny’s pay. The payroll service will perform all the withholding, issue paychecks, perform direct deposit, remit payments to the IRS and the EDD, file your employment tax returns, and issue the nanny’s W2 form. It is certainly easier to go this route, but it does involve a processing fee. We have a number of business partners that provide this service that we hold in high regard. Please see our Affiliates Page.