Nanny & Caregiver Pay Stub — Calculate Nanny Paycheck, Tax Deductions & Household Employee Wages

9 min readUpdated: February 5, 2026

Need to calculate nanny paycheck amounts or understand nanny deduction taxes? Whether you're a household employer looking for tax deductions for nanny expenses, trying to understand nanny deduction rules, or need to document household employee wages properly — this guide covers everything about paying nannies, caregivers, and other household employees.

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Household Employee Wages Overview

Household employee wages are payments made to workers who perform services in your home — nannies, babysitters, housekeepers, caregivers, elder care aides, private nurses, gardeners, and personal assistants. Unlike independent contractors, household employees work under your direction and control.

Worker Type	Classification	Typical Hourly Rate (2025)	Nanny Tax Applies?
Nanny (full-time)	Household employee	$18-$30/hr	✅ Yes (if $2,700+/yr)
Babysitter (occasional)	Household employee	$15-$25/hr	Only if $2,700+/yr
Housekeeper	Household employee	$15-$25/hr	✅ Yes (if $2,700+/yr)
Elder caregiver	Household employee	$16-$28/hr	✅ Yes (if $2,700+/yr)
Cleaning service	Independent contractor	Varies	❌ No (they handle taxes)

For understanding the difference between employees and contractors, the key test is control: if you direct when, where, and how the work is done, they're an employee. Household employee wages must be reported on Schedule H of your tax return.

How to Calculate Nanny Paycheck

To calculate nanny paycheck amounts correctly, follow these steps. We'll walk through a complete example of how to calculate nanny paycheck for a $20/hour nanny working 40 hours:

Step	Calculation	Amount
1. Gross pay	$20/hr × 40 hours	$800.00
2. Social Security (6.2%)	$800 × 6.2%	−$49.60
3. Medicare (1.45%)	$800 × 1.45%	−$11.60
4. Federal income tax (optional)	If nanny elected withholding	−$0 to −$80+
5. State income tax (optional)	If applicable in your state	Varies
Net pay (no income tax)	$800 − $49.60 − $11.60	$738.80

When you calculate nanny paycheck amounts, remember that FICA taxes (Social Security + Medicare) are mandatory once you hit the annual threshold. For gross vs net pay details, see gross pay vs net pay.

Nanny Deduction Taxes Explained

Nanny deduction taxes (also called nanny deduction or "nanny tax") are the payroll taxes you must withhold and pay when employing a nanny or other household worker. Here's a complete breakdown of nanny deduction taxes:

Tax Type	Employee Pays	Employer Pays	Total
Social Security (OASDI)	6.2%	6.2%	12.4%
Medicare	1.45%	1.45%	2.9%
FUTA (federal unemployment)	$0	6% (first $7,000)	Up to $420/yr
SUTA (state unemployment)	Varies by state	Varies by state	Varies
Federal income tax	Optional (if requested)	$0	Varies

The nanny deduction for Social Security and Medicare is mandatory. You can choose to pay the employee's share yourself (grossing up their wages) or withhold it from their pay. For more on these taxes, see what is OASDI and Medicare on pay stub.

Tax Deductions for Nanny Employers

What tax deductions for nanny expenses can you claim as an employer? Here are the main tax deductions for nanny and childcare costs:

Tax Benefit	Maximum Benefit	Requirements
Dependent Care FSA	$5,000/year pre-tax	Employer-sponsored plan, child under 13
Child & Dependent Care Credit	20-35% of $3,000-$6,000	Child under 13, you work/look for work
Employer-paid childcare	Varies	If your employer offers this benefit

Important: Tax deductions for nanny employer-portion taxes (Social Security, Medicare, FUTA) are NOT deductible for personal household employers. These tax deductions for nanny expenses are only available if you're a business paying for employee childcare.

You cannot use both the Dependent Care FSA and the Child & Dependent Care Credit on the same expenses. For official IRS guidance, see IRS Publication 926.

What to Include on a Nanny Pay Stub

A proper nanny pay stub should include all the information needed for tax compliance and income documentation. Here's what to include when you create pay stubs for household employee wages:

Section	Information	Example
Employer info	Your name, address, EIN (if applicable)	John Smith, 123 Main St
Employee info	Nanny's name, address, SSN (last 4)	Jane Doe, XXX-XX-1234
Pay period	Start date, end date, pay date	01/01/26 - 01/14/26, paid 01/17/26
Hours & rate	Regular hours, OT hours, hourly rate	80 hrs @ $20/hr, 5 OT @ $30/hr
Gross pay	Total before deductions	$1,750.00
Nanny deduction taxes	SS, Medicare, income tax (if any)	$108.50 + $25.38 = $133.88
Net pay	Take-home amount	$1,616.12
YTD totals	Year-to-date for all categories	YTD gross, YTD taxes, YTD net

For sample formats, see pay stub samples. For abbreviation meanings, see pay stub abbreviations.

Nanny Tax Thresholds (2025-2026)

The nanny tax only applies when household employee wages exceed certain thresholds. Here are the current limits:

Threshold	2025 Amount	What It Triggers
Social Security & Medicare threshold	$2,700/year	Must withhold and pay FICA taxes
FUTA threshold	$1,000/quarter	Must pay federal unemployment tax
W-2 requirement	$2,700/year	Must issue W-2 to nanny by Jan 31
Social Security wage base	$176,100/year	SS tax stops above this amount

These thresholds apply to each household employee individually. If you have multiple household workers, calculate nanny paycheck thresholds separately for each. For W-2 creation guidance, see create W-2 from pay stub.

Creating Nanny & Caregiver Pay Stubs

You have several options for creating pay stubs that document household employee wages:

Method	Pros	Cons
CleanPaystubs generator	Fast, professional, handles calculations	Per-stub cost
Nanny payroll service	Full tax filing, direct deposit	Monthly subscription ($40-75/mo)
Excel/Word template	Free, customizable	Manual calculations, error-prone
QuickBooks/Gusto	Integrated payroll, tax filing	Monthly cost, may be overkill

For templates, see Excel templates and Word templates. For professional output, see PDF templates.

Create Professional Nanny Pay Stubs

Generate pay stubs for your nanny or caregiver with all the required information — hours, household employee wages, nanny deduction taxes, and YTD totals. Ready in minutes.

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Frequently Asked Questions

How do I calculate nanny paycheck amounts?

To calculate nanny paycheck: Start with the agreed hourly rate × hours worked = gross pay. Then subtract nanny deduction taxes: Social Security (6.2%), Medicare (1.45%), and federal/state income tax if the nanny elected withholding. For example: $20/hr × 40 hrs = $800 gross. Minus 7.65% FICA ($61.20) = $738.80 net (before income tax). Use a nanny paycheck calculator or our pay stub generator for precise calculations.

What are nanny deduction taxes?

Nanny deduction taxes and nanny deduction amounts include: Social Security tax (6.2% from nanny's wages + 6.2% employer match), Medicare tax (1.45% from nanny + 1.45% employer match), federal unemployment tax (FUTA - employer only, 6% on first $7,000), and state unemployment tax (varies by state). Income tax withholding is optional unless your nanny requests it. These nanny deduction taxes apply when you pay a household employee $2,700+ per year (2025 threshold).

What tax deductions for nanny can employers claim?

Tax deductions for nanny expenses depend on your situation: If you use a Dependent Care FSA, you can set aside up to $5,000 pre-tax for childcare. The Child and Dependent Care Credit lets you claim 20-35% of up to $3,000 (one child) or $6,000 (two+ children) in care expenses. You cannot claim both FSA and credit on the same expenses. The employer portion of nanny deduction taxes (Social Security, Medicare, FUTA) is not deductible for personal household employers.

What are household employee wages?

Household employee wages are compensation paid to workers you hire to perform services in or around your home — including nannies, housekeepers, caregivers, private nurses, gardeners, and personal assistants. If you control what work is done and how it's done, the worker is a household employee (not a contractor). Household employee wages above $2,700/year (2025) trigger 'nanny tax' obligations including Social Security, Medicare, and unemployment taxes.

Do I need to give my nanny a pay stub?

While not federally required in all cases, providing pay stubs to your nanny is strongly recommended and required in some states (California, New York, etc.). A nanny pay stub documents hours worked, gross pay, nanny deduction taxes withheld, and net pay. It protects both parties, helps your nanny file taxes, and provides proof of income for loans or apartments. Use our generator to create professional nanny pay stubs.

What is the nanny tax threshold for 2025-2026?

The nanny tax threshold for 2025 is $2,700 — if you pay any household employee this amount or more in a calendar year, you must withhold and pay Social Security and Medicare taxes. The FUTA threshold is $1,000 in any quarter. These thresholds typically increase slightly each year. For 2026, check IRS Publication 926 for updated amounts. Below the threshold, you can still choose to pay nanny deduction taxes voluntarily.

How do I calculate nanny paycheck with overtime?

To calculate nanny paycheck with overtime: Pay regular rate for hours 1-40, then 1.5× the regular rate for hours over 40 per week (federal law). Example: $18/hr nanny works 45 hours. Regular: 40 × $18 = $720. Overtime: 5 × $27 = $135. Gross: $855. Then subtract nanny deduction taxes. Live-in nannies may have different overtime rules depending on state law — check your state's domestic worker regulations.

Can I pay my nanny as a contractor (1099)?

Generally no — the IRS considers most nannies and caregivers to be household employees (W-2), not independent contractors (1099). You control when, where, and how they work, which makes them employees. Misclassifying a nanny as a 1099 contractor can result in back taxes, penalties, and interest. The nanny deduction taxes you avoid by misclassifying will eventually come due with penalties. Always pay household employee wages properly.