Is a Nanny a Contractor?

Believe it or not, a Nanny is not considered a contractor.

You are probably saying to yourself, What? That can’t be. I’ve always provided my Nanny with a 1099 form at the end of the year and never had an issue.

That may be so, however, the Internal Revenue Service (IRS) states otherwise. Your Nanny is considered a household employee and you both are responsible for applicable taxes such as federal, state, local, unemployment (for employers), etc. Check out page 3 via the hyperlink above for more info.

But don’t worry, its not as intimidating as it may seem.


Go ahead and breathe a sigh of relief.

Hire a great Nanny Tax Expert Payroll Service who can take care of everything for you. They will make sure the process is as seamless as possible and keep you up to date on everything tax related. So there are no surprises at the end of the year, when its filing time.

We all have plans with our tax refunds, like a vacation for example.

Surprises are never ideal.

Having experts in every field is great. So why not take advantage?

A personal favorite of ours is Homework Solutions. The great thing is, they offer a non obligation free consultation and you can ask all the questions you want! You learn about your duties as an Employer, without the pressure of having to actually sign up and use the service.

Did I mention the consultation is free? Sounds like a no-brainer to me!

Oh no, are you still thinking of continuing your Nanny as a 1099?

We highly recommend that you don’t. For starters, its illegal (ouch) and 2, it really isn’t overwhelming! Avoid the headache later on, and start off on the right foot with your Nanny and the IRS. Its a win, win for everyone. When you file your taxes, you may be eligible for a child tax credit (Yes!). You are also paying into Social Security and Medicare. Don’t we all look forward to that retirement income?

For your Nanny they are now eligible for some benefits (depends on the state) such as disability, unemployment, paid time off, overtime and even income for when they eventually retire. Last but not least, they can use this proof of income to help them survive! Yes, this allows them to lease an apartment, finance a car, which in returns helps them to take care of their own family and get to work to care for yours!

Proof of income is great for everyone!

Oh and don’t forget, this is an incentive for your Nanny to stay for the long term with your family. Professional Nannies love to grow and build with their charges. With the benefits and perks of being paid legally, its just one more thing to help make it all worthwhile.

So in a nutshell, protect yourself and your Nanny. It is worth it in the long run.

About Khadijah

A former Nanny, Khadijah is the founder of Muslim Nannies and RAHMA (HIV/AIDS organization). She is passionate about helping the community and identifying resources to help others. She was invited to The White House and met President Obama in recognition for her efforts. She also writes for The Huffington Post. Khadijah resides in Northern VA with her husband and daughter.

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