CLIENT LOGIN | Member Services OR EMPLOYEE LOGIN | Self Service

Can an employer pay the nanny on the payroll of their own business?

Nanny employers who are sole proprietors and have other business employees may choose to include their nanny’s payroll in their 941 or 943 tax returns. The ‘nanny taxes’ are exactly the same employment taxes paid for other employees and do not require special calculation.

What the sole proprietor may not do is include the nanny’s payroll and associated payroll taxes in their business tax deductions. A nanny provides childcare and is a contributing member of a household, not the employer’s business.

Sole Proprietors who do not wish to co-mingle their household and business payroll may choose to report the nanny wages on Form 1040 Schedule H and would then remit the W-2 form at year end with a separate W-3 cover form.

ยป More Information: Publication 926

FREE Updates & Tools

FREE Updates & Tools

Sign up with HomeWork Solutions today for valuable resources only available to our subscribers.

  • Receive industry related news and updates though our blog.
  • Access our FREE payroll tax calculators.
  • Access special offers & downloads.

I understand that I am registering for access to HWS. I grant HWS permission to contact me via email regarding household payroll and tax services they offer.

All fields are required.