Paying Taxes If You Are a Nanny or Childcare Provider

Updated on March 20, 2008
K.C. asks from Aurora, IL
4 answers

I was wondering if anyone knew of any website regarding being a nanny or household employee and what taxes had to be paid. I wasnt sure if I could just claim it myself and being self employed and what forms have to be filled out. Is there a difference between being a "nanny" or a "childcare provider" when it comes to taxes.

Thank you!

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answers from Bloomington on

Hey K.,

Since you asked about being a nanny OR childcare provider. Not sure which info you really need more about.

But as a daycare provider in your own home, you are expected to pay all taxes. As some one who works in anothers home, the employers are expected to pay your SS and maybe some other stuff. Withholding taxes optional, when I was a nanny I paid my own "taxes".

I can't find the good site for information right now. But I did find one somewhat useful if you're a nanny or for someone who would be looking to hire one.

Hope this helps, K.



answers from Chicago on

I am a home day care provider and I just filed with H&R Block. It is not hard. But if your home is your business, make sure to save all of your household bills, grocery receipts, extras for the childcare etc. You get a huge return at the end of the year for that. I didn't know all that, this year was my first claiming my daycare and I thought we were going to be screwed because obviously no taxes come out of my pay, but I ended up getting a ton back. Worked out well. If you have any questions, feel free to ask.



answers from Chicago on

Well - I don't know of any websites....I looked far and wide and eventually just had to ask another home daycare provider to mentor me with my taxes. Now, I've got it down pat! (using Turbotax helps ALOT! It walks you right through it.)

I think there IS a difference between being a 'Nanny' and a "childcare provider"....mostly based on if it's in your home or theirs. And, IF it's in theirs, THEY are responsible for paying the taxes, at least, that's my understanding.

Good luck and please feel free to ask me any other questions you may have.




answers from Chicago on

If you go on and look up household employee or daycare provider you can get a walk through on how to pay your taxes, FUTA, etc. A household employee (e.g. nanny) is different from self-employed in that the employer does pay at least 1/2 of the social security and medicare taxes and also pays the unemployment taxes (Federal and State). When self-employed, you cover those taxes through the self-employment tax rate, I think is what it is called. But then you can take deductions on your expenses (part of utilities, mortgage, etc for portion of time and area of your home used for employment purposes) which should make it a lower tax rate. Like I said, it's all explained in the IRS publications which you can find on their site.

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