Which Taxes are Household Employers Required to Pay and Withhold for Employees?

You are required by law to pay:

  • Employer’s share of FICA (Social Security + Medicare) a Federal tax levied on Employers and Employees
  • FUTA (Unemployment Tax) a Federal tax levied on Employers
  • Unemployment and Disability Insurance a State tax levied on Employers

These are in addition to the gross amount of your nanny’s salary.

You are required by law to withhold:

  • Employee’s share of FICA (Social Security + Medicare) a Federal tax levied on Employers and Employees

These are taken out of the gross pay you pay your nanny.

Additionally, you may (and are strongly encouraged to) withhold:

  • Unemployment and Disability Insurance in states that levy this tax on Employees
  • Income tax, levied on Employees by Federal and State agencies.

These are taken out of the gross pay of your nanny’s salary. You pay nothing in addition. Your nanny will still owe these taxes if you do not withhold. Since your nanny may not know how much to withhold and how to report it, it is strongly recommended that you use Savvy Nanny Payroll Services to withhold these taxes as it will require no additional effort on your part. But ultimately, the choice is yours.

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