2026 tax year · household employers
Nanny Tax Calculator (2026)
Pay a nanny $3,000 or more in cash wages in 2026 and you owe 7.65% in Social Security and Medicare. You also withhold 7.65% from the nanny's pay, or cover it yourself. Pay $1,000 in any quarter and federal unemployment tax adds 0.6% on the first $7,000. Enter one paycheck below to see your full federal cost.
Every figure comes from IRS Publication 926 (2026), the Household Employer's Tax Guide dated November 24, 2025. Rather not run it by hand? Two household payroll services are listed under the result.
Your household payroll, federal only
- Cash wages this year
- $41,600.00
- $3,000 Social Security and Medicare threshold
- Met
- FUTA test: $1,000 in a quarter (busiest quarter $10,400)
- Met
Your total cost as the employer
$44,824.40
per year · $862.01 per paycheck, federal only
- Nanny's wages
- $41,600.00
- + Your Social Security (6.2%)
- $2,579.20
- + Your Medicare (1.45%)
- $603.20
- + FUTA (0.6% of the first $7,000)
- $42.00
- Annual employer cost
- $44,824.40
The nanny's paycheck
- Gross pay
- $800.00
- − Social Security withheld
- $49.60
- − Medicare withheld
- $11.60
- Net pay before income tax
- $738.80
- Owed with Schedule H for 2026
- $6,406.80
- Form W-2 box 1 wages
- $41,600.00
Estimate for tax year 2026 from IRS Publication 926 (2026). Assumes one unrelated adult employee paid in cash on even paydays, the full 5.4% FUTA credit, and no federal income tax withholding. State unemployment tax and state withholding are not included. Not tax advice.
Hand the paperwork to a household payroll service
We have applied to partner with Poppins Payroll and SurePayroll through the Impact affiliate network. Neither program is active, so neither link pays us today. If one approves us, we may earn a commission when you sign up through it, at no extra cost to you. This never changes the math above.
- A payroll service that works only with household employers: nannies, senior caregivers, housekeepers.See Poppins Payroll
- Paychex-backed payroll with a nanny and household plan that produces your Schedule H and W-2 forms.See SurePayroll
Sponsored · opens in a new tab. Not tax advice.
The 2026 numbers
Six figures decide what a nanny costs you in federal tax
- $3,000
- Cash wages to one employee in 2026 that trigger Social Security and Medicare
- 7.65%
- Your share: 6.2% Social Security plus 1.45% Medicare
- 7.65%
- The nanny's share, withheld from pay or paid by you
- $184,500
- 2026 Social Security wage base (Medicare has no cap)
- $1,000
- Cash wages in any quarter of 2025 or 2026 that trigger FUTA
- 0.6%
- FUTA after the full 5.4% credit, on the first $7,000 per employee
Source: IRS Publication 926 (2026), What's New and Table 1. The two tests are separate. A family can owe FUTA without owing Social Security and Medicare, as the fourth example below shows.
A nanny in your home is usually your employee
The IRS test is control. If you decide what work gets done and how, the worker is your household employee. Full time or part time makes no difference, and neither does hiring through an agency. Pub 926 lists babysitters, nannies, housekeepers, caretakers, health aides and private nurses among household workers.
Two cases fall outside. A sitter who cares for your child in their own home is generally not your employee. Neither is a worker the agency supplies and directs.
Some wages never count for Social Security and Medicare, even over $3,000: wages paid to your spouse, your child under 21, your parent (with a narrow exception), or a worker under 18 whose main job is not household work, such as a student.
Schedule H and Form W-2 are the two filings that matter
Schedule H goes with your own Form 1040. It adds up both shares of Social Security and Medicare, FUTA, and any income tax you agreed to withhold. For 2026 wages it is due with your return, by April 15, 2027.
Form W-2 goes to the nanny by February 1, 2027, with Copy A and Form W-3 sent to the Social Security Administration the same day. You need one for any employee paid $3,000 or more in Social Security and Medicare wages, or whose income tax you withheld. Both forms need an employer identification number.
Schedule H settles the bill once a year, but paying it all then can trigger an estimated tax underpayment penalty. To stay ahead, raise the withholding on your own W-4 or make estimated payments. The 2026 estimated tax dates are April 15, June 15, September 15 and January 15, 2027.
Covering the nanny's share raises their taxable wages
You can pay the nanny's 7.65% yourself, so the agreed rate is what lands in the nanny's account. Pub 926 allows it, with one catch. The share you cover counts as extra wages for income tax, though not for Social Security, Medicare or FUTA.
Pub 926 prices it at $100 a week. You pay $15.30 in tax each payday, and the nanny's income tax wages become $107.65 a week. Pick the second option in the calculator and the Form W-2 box 1 figure updates to match.
Your state adds its own layer
This calculator stops at federal tax. Your state may also charge household employers unemployment tax, and the full 5.4% FUTA credit assumes you pay any state amount on time. Pub 926 also flags state withholding and workers' compensation insurance as things to check. Rates and wage bases differ by state and we do not estimate them here. Your state unemployment agency (Department of Labor directory) has the rules.
If you and your nanny agree to withhold income tax, our state paycheck calculators show 2026 federal and state withholding on a paycheck. They cover income tax only, not unemployment insurance.
A payroll service earns its fee once the state filings start
The federal side of one nanny is manageable by hand. You withhold 7.65% each payday, file one W-2, and add Schedule H to your return. The math above is the whole of it.
The workload grows elsewhere. If your state charges unemployment tax, that can mean an account with its agency and filings on its own timetable. Hire a second employee and you run every step twice. That is when handing it off starts to look worth it.
If you are there, compare the two household payroll services under the calculator. Ask each one which state filings its price covers.
Worked examples
Four nanny tax scenarios, worked from Pub 926
The first two rows are the examples printed in Pub 926 (2026). The other two apply the same rules. Figures are for the full year.
| Scenario | Wages | Your SS + Medicare | Nanny's share | FUTA | Your cost |
|---|---|---|---|---|---|
| $70 a week for 48 weeks, share withheld (Pub 926 example) | $3,360 | $257.04 | $257.04 | $0.00 | $3,617.04 |
| $100 a week for 52 weeks, you pay the nanny's share (Pub 926 example) | $5,200 | $397.80 | $397.80 | $31.20 | $6,026.80 |
| $900 a week, full year, share withheld | $46,800 | $3,580.20 | $3,580.20 | $42.00 | $50,422.20 |
| $2,900 paid once, under the $3,000 threshold | $2,900 | $0.00 | $0.00 | $17.40 | $2,917.40 |
Row 1: Pub 926 prints $208.32 Social Security and $48.72 Medicare for each side. Its busiest quarter is 13 weeks at $70, or $910, so no FUTA, assuming no 2025 quarter reached $1,000. Row 2: Pub 926 prints $15.30 per payday; over a 52-week year that is $795.60, plus $31.20 FUTA. Your cost includes the nanny's share only where you pay it.
Common questions
Nanny tax questions, answered from the IRS guide
- What is the nanny tax threshold for 2026?
- $3,000. If you pay one household employee $3,000 or more in cash wages in 2026, all of that employee's cash wages are subject to Social Security and Medicare tax. A separate test covers federal unemployment tax: $1,000 or more in cash wages to all household employees in any calendar quarter of 2025 or 2026.
- Do I have to withhold federal income tax from my nanny?
- No. IRS Publication 926 says you are not required to. You withhold federal income tax only if your nanny asks you to and you agree, in which case the nanny gives you a Form W-4 and you use the tables in Publication 15-T.
- What happens if you don't pay the nanny tax?
- If you were required to withhold and pay employment taxes and did not, you are generally liable for the taxes you should have withheld and paid, and the IRS may charge interest and penalties. Penalties can also apply for missing the Form W-2 deadlines.
- Can I get a tax credit for what I pay my nanny?
- Possibly. If the nanny cares for your dependent under 13, or a spouse or dependent who cannot care for themselves, so that you can work or look for work, you may qualify for the child and dependent care credit. Your share of federal and state employment taxes counts toward the qualifying expenses along with the wages. IRS Publication 503 has the rules. Read Publication 503.
- Is a nanny I found through an agency my employee?
- Usually yes, if you control what work is done and how it is done. Hiring through an agency or from an agency's list does not change that. The worker is the agency's employee only when the agency provides the worker and controls the work. A sitter who looks after your child in their own home is generally not your employee.
Sources
- IRS Publication 926 (2026), Household Employer's Tax Guide
- SSA contribution and benefit base (2026: $184,500)
- IRS Schedule H (Form 1040), Household Employment Taxes
- U.S. Department of Labor, state unemployment insurance agencies
- IRS Publication 503, Child and Dependent Care Expenses
Want to know what you take home from your own job while paying a nanny? The state paycheck calculators show your net pay after federal and state withholding. When the household payroll gets to be too much, the payroll services above can take it on.
Estimates for tax year 2026, based on IRS Publication 926 (2026) constants verified . Federal only. Not tax advice.