Nanny Taxes Made Easy

This post was sponsored by our partners at Poppins Payroll.

Hiring a nanny is a difficult task for many families.  Figuring out payroll and nanny taxes is an even bigger challenge.  You don’t need to wait for Mary Poppins to magically land on your doorstep to help with nanny taxes.  There’s a dependable service that has just arrived in Massachusetts from the west wind.

Poppins Payroll is an affordable and reliable solution for families to properly pay their household employees and file payroll taxes. For only $45 a month, Poppins Payroll makes payroll and taxes a breeze!

Who are these household employees? 

Well, they are the nannies that watch your kiddos during the week, the babysitters that stay in while you go on a much needed date night, the elder care attendant that keeps grandma company, and the housekeepers that make your kitchen shine! When you employ any of these roles (and more!) in your home and pay them more than $2300 in a year, or $1000 in a quarter the IRS considers them a household employee.

Why does it matter that my nanny is a household employee? 

As a household employer, you must comply with certain tax obligations, commonly referred to as “nanny taxes”.  You’ll need to obtain a Federal Employer Identification Number (EIN), report information about your employee to your state’s new hire reporting agency, register with one or more departments in your state, and, in some municipalities, you’ll have to register for and pay local business taxes.

After you have registered as an employer with all the appropriate agencies, you must:

  • Payroll – At every pay period, withhold certain state and federal taxes such as income tax, Social Security, and Medicare, and you must also calculate employer contributions such as unemployment taxes related to those wages. 
  • Quarterly – submit the proper paperwork and payments to the correct agencies. The agencies will typically include the IRS, the state and any other local agencies that require remittances, including certain municipalities.
  • Year-End – provide your employee with his or her W-2 form, submit a copy of the W-2 and W-3 to the Social Security Administration, submit state reconciliations if required and prepare a Schedule H to file with your individual tax returns.

You can find all the information about your federal obligations in the IRS’s Publication 926 – Household Employer’s Tax Guide.


Payroll and Withholdings and Taxes, Oh My!

There are many things in life that can feel overwhelming, and taxes might just be top of the list! Not to worry! Poppins Payroll is here to help you tackle the hard stuff so you can mark tax worries off your list. 

Sign-up quite literally takes 10-minutes! After that, Poppins Payroll will get you an Employer Identification Number from the IRS, set up all your federal, state and local tax accounts, and file all required new-hire paperwork with state agencies. You don’t need to lift a finger. 

Perfect Payroll Taxes Every Time! 

The Poppins Promise ensures that your taxes are handled with care and are 100% accurate. You can rest easy with guaranteed accuracy and on-time remittance no matter what! This is great news for busy families who have better things to do than to spend their time researching tax laws and timelines. 

Poppins Payroll handles all the specifics that come with ongoing employee payroll.  Poppins Payroll will effortlessly calculate the appropriate withholding amount for each paycheck and the amount due to each government agency.  We’ll gladly handle direct deposit from your account to your employee’s account, or, if you prefer to do it yourself, we’ll let you know the amount to write the check for.  Either way, we’ll send paystubs to the employee.  

Poppins will also keep track of all the tax deadlines and rules, always paying your taxes to the correct agencies on time and with total accuracy guaranteed. Paper forms are old-fashioned, so they prep, file and pay all your automatically online for all states that allow it.  At the end of the year, Poppins even generates a W-2 for your employee and a Schedule H for you to be able to file your taxes. 

Resources for the DIY household employer.

Even if you don’t hire Poppins, they want to help.  They have a ton of great content on their website to guide you through all the requirements.  Check out their Payroll Guide and their Massachusetts Resource Page.  They even have an amazing Nanny Contract that you can use.

Sensibly priced. Superbly professional.

The IRS estimates that it takes a family 60+ hours a year to sort every detail that Poppins takes care of.  That’s time better spent with your kids!   Especially, when Poppins only charges $45 per month! There are absolutely NO hidden fees and NO minimum contract period. And as if that wasn’t enough your first calendar month is FREE so you can test out the system for yourself. Get started today!

Meghan was born and raised on the South Shore and attended college in Boston. After college, she married her high school sweetheart and followed him to Charleston, SC, and Groton, CT, where he served as a submarine officer in the United States Navy. Military life was an adventure, and after six crazy years of service (and two babies later!), the pair decided to move *home* to the South Shore in 2016 and put down some roots. Meghan is the proud owner of Boston Moms and work-at-home mom to William, Benjamin, and Caroline, born in 2013, 2015 and 2019. She loves meeting new people, encouraging moms, celebrating motherhood, and supporting small businesses.