Many parents have questions about having to pay taxes after employing a nanny.  Below are the most popular questions (and answers) about paying nanny taxes. 

1. Are nannies considered independent contractors or employees?  
The law states that employees that are hired to work within a family's home, such as nannies, housekeepers, and senior caregivers, are considered employees, and not independent contractors.  Hence, parents are responsible for paying for their nannies' taxes, as well as withholding their taxes.   

2. Are nanny taxes affordable for my family?  
The cost of paying for a nanny includes State Unemployment Insurance, Federal Unemployment Insurance, and 50% of Medicare and Social Security. 

3. Is there a method for accurately calculating how much my anticipated monthly expenses will be when paying my nanny's salary and taxes?  
Yes.  You can use the Breedlove & Associates’ Free Nanny Tax Calculator (http://www.breedlove-online.com/tax-labor-law) to estimate your nanny tax costs.  There are also various other online softwares families can use to estimate their nanny tax payments.