Hiring a nanny in California, the right way
On the books, and simpler than it sounds
We do everything on the books. That protects your family, protects your nanny, and often costs less than you'd think once the tax breaks are counted. Here's how it works in plain English, with links to the law so you can check every word.
Two ways to work with a nanny
Occasional care
The nanny's own business
Date nights, events, a few hours here and there. You pay by card after each visit, like any service. The nanny handles her own taxes.
A regular schedule
Your family employs the nanny
About 25 or more regular hours a week. You're the employer; a nanny payroll service does the taxes for about $50 a month. We set it up with you in one evening, and our family portal keeps the timesheets.
When does a nanny count as your employee?
There's no magic number of hours. The IRS and California look at who controls the work: if you set the schedule and say how the job is done in your home, the nanny is usually your household employee. The IRS's own example of a household employee is a nanny.
What an employer family does, and who handles it
| The rule (2026) | What it means | Who handles it |
|---|---|---|
| Social Security and Medicare once wages reach $3,000 in the year | 7.65% from you, and 7.65% withheld from your nanny's pay | Payroll service |
| Register with California's Employment Development Department within 15 days of paying $750 in a quarter | State disability insurance withheld from pay; state unemployment and job-training taxes from $1,000 a quarter | Payroll service |
| California minimum wage, $16.90 an hour | Our nannies' rates are well above it | Already done |
| Overtime after 9 hours in a day or 40 in a week | Time and a half. The portal warns you ahead of time when the schedule would lead to overtime, so you can adjust | Portal timesheets |
| Paid sick leave, at least 40 hours or 5 days a year | For your nanny's own or her family's health | Portal keeps the balance |
| Workers' compensation insurance | Usually an add-on to your homeowners or renters insurance | You (one phone call) |
| Pay at least twice a month, with a pay stub | From timesheets you approve in the portal | Portal and payroll service |
| A written wage notice at hire | Pay rate, pay days, sick leave and who the employer is | Payroll service or our setup checklist |
It often pays for itself
A dependent care account through a parent's job (a Flexible Spending Account) lets you pay up to $7,500 a year of child care with pre-tax money (from 2026), and the child and dependent care tax credit only works when your nanny is on the books. Paying under the table loses both, and leaves you open to back taxes, penalties and an uninsured injury in your home.
Read the law yourself
- IRS Publication 926: Household Employer's Tax Guide
- IRS Topic 756: employment taxes for household employees
- IRS instructions for the child and dependent care credit (Form 2441)
- California Employment Development Department: household employers
- California Labor Commissioner: Domestic Worker Bill of Rights, common questions
- U.S. Department of Labor: overtime for domestic workers
- California Labor Code section 1454 (overtime for nannies)
- California Labor Commissioner: the written wage notice at hire
- California paid sick leave
This page explains the rules in general; it isn't legal or tax advice for your family. Figures are for 2026.