Taxes

[Anonymous]

Any idea what percentage of a nannys salary we have to pay in taxes? I know there are a lot of variables but just looking for a ballpark estimate for DC so we can budget what we can afford. Thanks!

[Anonymous]

Estimate 10% above what you pay for taxes (7.65%), unemployment insurance, workman's comp, and a bonus or two.

[Anonymous]

Thanks! So taxes alone are typically 7.65 percent?

[Anonymous]

Anonymous wrote:Thanks! So taxes alone are typically 7.65 percent?

The employer portion of FICA taxes (Social Security and Medicare) is 7.65%.
The employee pays an equal amount, usually withheld from the paycheck.

Some nannies ask the parents to pay their amount also, so you would then be looking at 15.3% above the base pay. I have never agreed to pay any portion of my nanny's taxes. I pay employer part plus unemployment insurance (both state and federal) and workman's comp.

As a household employer, you do not have to withhold income tax (you can), though the nanny must still pay it. That comes out of the nanny's check though, so is not over and above what you pay.

[Anonymous]

Thanks!

[Anonymous]

I would just make sure you calculate carefully and truly understand. It is always more than you think...

[Anonymous]

Most nannies want you to withhold income tax.

[Anonymous]

The calculator tool at Homeworksolutions.com will calculate both what you deduct and what you pay yourself.

[Anonymous]

Anonymous wrote:Most nannies want you to withhold income tax.

+1

[Anonymous]

Anonymous wrote:

Anonymous wrote:Most nannies want you to withhold income tax.

+1

True, but this does not add to the overall cost of having a nanny since it comes out of her paycheck (unless you use a payroll service, which runs a couple hundred dollars a year).