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All About Nanny Pay and Benefits

Benefits

Full-time nannies can expect to receive some benefits along with their standard weekly or hourly pay. Benefits usually include 1-2 weeks of paid vacation, 2-3 sick days, and 2 personal days. Some families provide health insurance for nannies. Live-in nannies of course receive the added benefit of room and board at no cost to them including their private room and sometimes a separate bath. If the nanny is required to transport children, they generally receive use of a car and cell phone or GPS system.

Nanny Pay

Nanny compensation varies widely, depending on the amount of experience a nanny has, whether you provide housing for her and what area you live in. According to the International Nanny Association, nannies who are just starting out in the profession may make from $250 to $400 a week. Nannies with training can make from $400 to $1,000 a week.

The International Nanny Association 2009 Salary Survey breaks down the figures a little more clearly in a survey of Six hundred and sixty seven (667) in-home child care providers.

(Some respondents are part-time employees)

10.79% reported earning $300 or less per week
10.04% reported earning $500 per week
9.15% reported earning $600 per week
7.20% reported earning $700 per week
7.20% reported earning $550 per week
7.05% reported earning $650 per week
6.00% reported earning $850 per week
5.40% reported earning $450 per week
5.25% reported earning $400 per week
4.80% reported earning $800 per week
4.80% reported earning $750 per week
3.60% reported earning $950 per week
2.55% reported earning $1000 per week
2.10% reported earning $900 per week

Overtime Pay

Overtime pay is generally calculated at 1.5 times the usual hourly wage for time worked in excess of 40 hours per week. Nannies who work more than 40 hours within a 7-day workweek must get overtime pay, according to federal law.

Laws and Regulations

Check with your accountant to make sure you are adhering to all the laws and regulations when it comes to hiring a nanny. Generally, however, a nanny is classified as an employee and not a general contractor and is therefore subject to nanny taxes.

Nanny Taxes

Figuring out the tax requirements in your nanny's pay doesn't have to be complicated once you break down the amounts by category. If your nanny is an employee, you'll usually withhold anywhere from 15 percent to 20 percent of her pay in taxes. You should account for:

Social Security and Medicare
Federal Income tax
State Income tax (in some cases)

As an employer, you're also obligated by the federal government to pay Social Security taxes on your nanny's salary. In many states, employers of nannies must also pay the state unemployment taxes. Nannies must pay Social Security taxes as well as federal income taxes on their nanny salary.

Your accountant can help you ensure you are managing nanny taxes correctly. There are also very affordable Nanny Tax services that can manage the process for you easily and affordably.