Hire a Nanny & Pay Them the Right Way
We know the Nanny industry better than anything! Which is why you will feel supported through each step of the process.
Common Questions regarding TAx compliance
When you hire a nanny through Hunny Nanny Agency, we’ll walk you through the basics of getting payroll started. While we don’t process payroll ourselves, we make sure you know the steps, what’s required, and who can help. Here’s our quick-start checklist for families:
✔️ Confirm your nanny’s employment status – Nannies are household employees, not independent contractors. This means they should be paid legally, with taxes withheld.
Set up legal pay – Decide how you’ll track hours, overtime, and guaranteed hours so paychecks stay accurate and compliant.
Register as a household employer – Apply for a federal Employer Identification Number (EIN) and any state tax accounts you’ll need.
Choose a payroll provider – We’ll suggest trusted companies that specialize in nanny payroll, so you don’t have to figure it out alone.
Plan for workers’ compensation insurance – In many states, this protects both you and your nanny. We’ll point you toward where to start.
Stay on top of taxes & filings – From W-2s at year-end to quarterly taxes, your provider will handle the details—so you can focus on your family.
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Yes. In nearly all cases, nannies are considered W-2 household employees, not independent contractors. This means:
Families act as the employer – You are responsible for setting up household payroll, withholding taxes (Social Security, Medicare, income tax), and paying employer contributions (like unemployment tax).
Nannies are not 1099 contractors – The IRS has very strict rules around this. Because nannies work under your direction in your home, they do not meet the test for independent contractor status.
Compliance protects both sides – Proper W-2 status ensures your nanny receives fair wages, tax contributions, and eligibility for benefits, while you stay compliant with state and federal law.
At Hunny Nanny Agency, we walk families through the logistics of payroll, tax setup, and benefits—so the relationship is not only warm and successful, but also legally sound.
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While some families manage nanny payroll themselves, most find it stressful. Payroll services handle withholding, filing, tax payments, direct deposit, and year-end W-2s. This ensures you stay compliant with IRS rules and state laws. Hunny can connect you with vetted providers who specialize in household employment.
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Yes. Because nannies are W-2 employees, families must contribute to state and federal unemployment insurance. This protects both you and your nanny if employment ends unexpectedly. A payroll service will set this up automatically.
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We encourage families to use a trusted household payroll service to stay compliant with taxes and employment laws. Here are three we recommend:
Poppins Payroll – Flat monthly fee, modern and easy to use. 👉 Here
HomePay – Full-service nanny payroll and tax management with a strong reputation. 👉 Here
GTM Payroll Services– Established, concierge-level payroll and HR support. 👉 Here
✨ Each of these providers will handle direct deposit, tax withholding, year-end W-2s, and compliance with federal/state laws so you can focus on your family — not the paperwork.
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Rates vary depending on your family’s needs and the nanny’s level of experience. In general, our families can expect to pay within the city averages listed below, but there are several factors that can influence where your nanny’s rate falls on the scale.
Base Rates:
Each of our service cities has its own typical hourly average (see the chart on our Rates Page for current numbers). These averages provide a realistic starting point for budgeting.
What Increases Rates:
Experience & Tenure – Nannies with 5–10+ years of professional experience, special certifications, or long-term references often command higher rates.
Additional Children – Caring for multiple children typically adds $2–$3/hr per sibling.
Specialized Skills – Infant care training, newborn experience, Montessori knowledge, or advanced education background can raise rates.
Household Support – Duties beyond childcare (family meal prep, errands, household organization) often shift the role toward a Family Assistant or Household Manager pay scale.
Location & Market Demand – In higher-cost or competitive areas (like Boston or Chicago), wages are naturally higher than in smaller markets.
What Keeps Rates at the Base Range:
Hiring for one child with straightforward care needs.
Minimal household duties outside of direct childcare.
A nanny who is newer to the field but still carefully vetted by Hunny.
At Hunny, we guide each family through setting a competitive, fair rate—balancing budget considerations with attracting the highest-quality caregivers for your role.
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Hourly rates depend on several factors:
Location – Rates are higher in larger cities (like Boston or Chicago) compared to smaller Midwest markets (like Cincinnati or Cleveland).
Experience & Education – Nannies with years of professional childcare, teaching backgrounds, or specialized training (like newborn care or Montessori) often earn more.
Role & Responsibilities – A family assistant or household manager who blends childcare with errands, cooking, or scheduling will expect a higher rate than a nanny focused only on childcare.
Schedule & Flexibility – Full-time, consistent hours tend to attract slightly lower rates per hour, while part-time, irregular, or overnight schedules often come at a premium.
Number of Children – Caring for multiple children, or children with additional needs, often means higher pay.
✨ We’ll walk you through setting a fair, competitive rate based on your family’s needs and the market in your city.
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When a nanny joins your family on a trip, the role shifts into travel nanny territory—which means clear communication and fair compensation are especially important.
Pay:
Hourly pay continues – Your nanny should be paid their regular hourly rate (or guaranteed hours) while traveling. Even if the schedule is lighter, their time is still reserved for your family.
Overtime applies – If daily or weekly hours exceed your state’s overtime thresholds, those rates apply on top of the base wage.
Travel time is work time – Flights, car rides, or waiting with your children during travel days should be paid.
Expenses:
Families cover all travel costs (airfare, hotel accommodations, meals while on duty, and incidentals directly related to childcare).
Nannies should have their own room or private sleeping space to ensure proper rest.
Expectations:
Outline in advance how much downtime your nanny will have each day, and whether there are hours they’ll be “off duty.”
Discuss childcare responsibilities that may be different from home (pool supervision, adjusting to jet lag, shared meals, late nights).
Provide a written outline or travel agreement so everyone knows the schedule, pay, and boundaries before departure.
Traveling with your nanny can be a huge help—and a memorable experience for your children—when handled with clear expectations and fair arrangements.
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Guaranteed hours mean that even if your family doesn’t need your nanny on a given day (because of vacation, sick kids, or changes in your work schedule), the nanny is still paid for their contracted weekly hours. This ensures your nanny can count on stable income — and in return, you can count on their commitment to your family.
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A work agreement is more than a contract — it’s a roadmap for your relationship. It outlines duties, schedule, pay, PTO, sick leave, holidays, confidentiality, and emergency procedures. Having everything in writing prevents misunderstandings and sets your nanny up for success. At Hunny, we provide every family with a detailed template to make this step easy.