If you employ a nanny, housekeeper, caregiver, or other household worker, you're likely a household employer — and that comes with real payroll obligations. Providing your household employee with a paystub isn't just good practice, it's often legally required. A proper paystub protects both you and your employee, creates a clear record of wages and taxes, and makes tax season significantly easier.
Are You a Household Employer?
The IRS considers you a household employer if you pay a domestic worker $2,700 or more in a calendar year (2026 threshold). This includes nannies, regular babysitters, housekeepers, private nurses, in-home caregivers, gardeners, personal chefs, and others who work in or around your home.
The key distinction: if you control what work is done and how it's done, the worker is your employee — not an independent contractor. Misclassifying a household employee as a 1099 contractor is a common and costly mistake.
Your Tax Obligations as a Household Employer
Once you cross the $2,700 threshold, several tax obligations kick in. Here's what you're responsible for.
Social Security and Medicare (FICA)
You must withhold 6.2% for Social Security and 1.45% for Medicare from your employee's wages. You also pay a matching 6.2% and 1.45% as the employer. The total FICA cost is 15.3%, split evenly between you and your employee.
Federal Unemployment Tax (FUTA)
You pay 6% on the first $7,000 of wages, reduced to 0.6% with the state unemployment tax credit. This is an employer-only tax — it's not withheld from your employee's pay.
State Unemployment Tax
Rates and requirements vary by state. Most states require household employers to pay into the state unemployment fund once wages exceed a certain threshold.
Federal Income Tax Withholding
Federal income tax withholding is not required for household employees. However, your nanny can request it by filling out a W-4. If they do, you must withhold accordingly.
State Income Tax Withholding
This depends on your state. Some states require withholding for household employees, others don't. Check your state's department of revenue for specific rules.
Tax Obligations at a Glance
| Tax | Rate | Who Pays | Required? |
|---|---|---|---|
| Social Security | 6.2% | Both | Yes |
| Medicare | 1.45% | Both | Yes |
| FUTA | 0.6% | Employer only | Yes |
| State Unemployment | Varies | Employer only | Usually |
| Federal Income Tax | Varies | Employee | Only if W-4 filed |
| State Income Tax | Varies | Employee | Depends on state |
What to Include on a Nanny's Paystub
A complete paystub for a household employee should include the same information you'd find on any professional paystub. At a minimum, include:
- Your name and address (employer)
- Employee's name and address
- Pay period dates (start and end)
- Hours worked
- Hourly rate
- Gross pay
- Social Security withholding
- Medicare withholding
- Federal income tax withholding (if applicable)
- State income tax withholding (if applicable)
- Any other deductions
- Net pay
- Year-to-date totals
If you're unsure what each of these fields means, our guide on how to read a paystub breaks down every line item.
How to Create the Paystub
Gather your information
Collect your employer details (name, address, EIN), your employee's details (name, address, last 4 of SSN), and the agreed-upon pay rate.
Calculate gross pay
Multiply hours worked by the hourly rate. Include any overtime at 1.5x the regular rate for hours over 40 in a week.
Determine tax withholding
FICA (Social Security and Medicare) is mandatory. Federal and state income tax withholding depends on whether your employee has filed a W-4.
Generate the paystub
Use Paystub Studio to enter the details and let the tax calculations run automatically. The system handles Social Security, Medicare, and income tax math for you.
Provide a copy to your employee
Give your nanny a copy of the paystub each pay period. This is their record of wages earned and taxes withheld.
Keep a copy for your records
Store your copies in an organized system. You'll need them for year-end tax filing and in case of any disputes or audits.
Common Mistakes Household Employers Make
- Treating a nanny as a 1099 independent contractor — If you control the work, they're an employee. The IRS takes this seriously.
- Not paying employer-side taxes — You owe a matching 6.2% for Social Security, 1.45% for Medicare, and FUTA on top of what you withhold.
- Not providing paystubs or keeping pay records — Many states require written pay statements. Even where it's not mandated, records protect you.
- Forgetting to file Schedule H — Household employment taxes are reported on Schedule H, filed with your personal tax return.
- Not getting an EIN — You need an Employer Identification Number to report and pay household employment taxes. Apply for one on the IRS website.
Year-End Tax Filing
At the end of the year, you'll need to:
- Provide your employee with a W-2 by January 31
- File Schedule H (Household Employment Taxes) with your personal tax return
- File W-2 and W-3 with the Social Security Administration
Having organized paystubs throughout the year makes this straightforward. Your YTD totals should match the W-2 exactly — if they don't, something needs to be corrected before you file.
Generate Paystubs for Your Household Employee
With Paystub Studio, you can generate professional paystubs with accurate Social Security, Medicare, and income tax calculations. Enter your nanny's pay details, and the system handles the tax math automatically.
If you're unsure whether your household worker qualifies as an employee, err on the side of treating them as one. The penalties for misclassification — back taxes, interest, and fines — are far more expensive than doing payroll correctly from the start.