Anonymous wrote:People have a house.
Same people need nanny.
People want to pay a little less for nanny by offering free rent.
Nanny needs job.
Nanny cannot afford apartment in DC area.
Nanny accepts job that pays a little less in exchange for free rent.
You cannot deduct for rent if job requires that you live in. Nannies are cheated on this. Too bad they don't know to look at IRS regs. You forgot to add the most importantl aspect of live-in nanny for employer is that nanny is there 24 hours a day, can't call in for bad weather, and so much easier for employer to take advantage of nanny.