8 Nanny Payroll Services: Making Parents Lives Easier

Products Nannies Love

No one likes paying taxes but it really does protect nannies to be paid legally. The benefits of being paid legally for nannies include:

History of Employment: Payment history helps to develop credit which is needed when applying for any type of loan including a credit card, car, mortgage, and rent.

Unemployment Benefits: Employees who lose their jobs, through no fault of their own, are able to receive a portion of their salary after a lay-off. This benefit is essential in a difficult economy and a pandemic!

Disability Benefits: If you have a non-work related illness or need to take maternity leave, you can collect Disability Insurance while you are unable to work.

Workers Compensation: Workers Compensations covers employees who become sick or injured while working. It is an insurance plan to help pay for necessary medical care.

Social Security and Medicaid: Full retirement benefits for Social Security and general medical coverage via Medicare are put into an account where you can collect once you meet a certain age requirement to retire. The extra money when you retire, or in addition to paying your medical expenses, will be a benefit.

When parents don’t pay nannies legally it is considered tax evasion. Employers that are not tax compliant are opening themselves to potential civil and criminal penalties and potential liability for taxes, penalty taxes, and additional charges. Parents that work as accountants, lawyers, or doctors risk losing their licenses to practice their profession if they don’t pay taxes for their household employees.

All of the parent employers that have hired me over the past 27 years have said using a nanny payroll company or payroll software has really made their lives easier.

Domestic employers need to get a federal Employer Identification Number (EIN) so they can legally pay their taxes. Parents must also withhold Social Security and Medicare taxes, then file these taxes with the appropriate government agencies. Some nanny payroll services and software help parents get an EIN. Nanny payroll software and services calculate taxes for parents, deduct the right amount from their employee’s paycheck, and file the taxes on time with the correct agency.

Nanny payroll software and services help household employers pay any type of domestic worker including: housekeepers, governesses or governors, cooks or chefs, chauffeurs, maids, and home health aides.

Here are some Nanny Payroll Services and Software nanny employers can use:

HomeWork Solutions:

From a nanny’s perspective and someone who looks for advice online from nanny industry experts, HomeWork Solutions is the most quickly accessible and friendly company to offer free advice to nannies and parents. Nannies can ask Co-Founder and Director of Compliance Kathy Webb for free advice all of the time. She is seen as a friend to dozens of nannies like myself who have loved attending Nanny Conferences with her over the years. She and her staff present many workshops for the company — providing nannies and their employers tons of free advice.

They were founded in 1993 and in those 27 years they really know what they are doing. Once parents open an account, they will get a dedicated account representative who knows everything there is to know about payroll. They provide unlimited telephone consultations. HomeWork Solutions supports both federal and state reporting for all 50 states. They also provide fully automated filings are specific to domestic employment and their database management system ensures accuracy.
They guarantee payroll tax returns will be filed accurately and timely, and all applicable payroll taxes will be paid on time. They guarantee no notices, no penalties, no red tape.

HomePay:

Back in the day Stephanie and Tom Breedlove of Breedlove & Associates were always sponsors, workshop presenters, and attendees at all of the Nanny Conferences I attended. In 2012 Care.com acquired Breedlove & Associates to make a convenient payroll and tax compliance company named HomePay. I always loved how friendly, knowledgeable, and accessible Stephanie and Tom Breedlove were at Nanny Conferences and on social media to help answer our payroll and tax questions. Unlike Breedlove & Associates, Care.com is not known for having good customer service or being accessible to helping nannies or household employees at all. Luckily parents have told me HomePay provides better customer service for its household employers who pay for their payroll services than Care.com provides in general.

Parents I have spoken to say HomePay is pricey but they feel it’s worth the price. It does offer workers compensation options and easy online account access for employers via myHomePay.com. Employees can also access their tax information using the web portal. They provide an easy paycheck direct deposit on employee pay days. They will help set up an IRS and state tax account, state new-hire reporting, tax calculations, electronic pay stub access, employee direct deposit, and monthly and quarterly tax preparation and filing. Household emoloyers can sign up for a Year-End Tax Packet that provides the W-2 employee distribution, W-2 and Schedule H (filed with Form 1040) document preparation, and filing.

GTM Payroll Services:

Guy Maddalone and GTM are a long-term, well-known staple in the nanny industry. GTM Payroll Services was founded by CEO and President Guy Maddalone way back in 1991. GTM Payroll Services always sponsors Nanny Conferences I have attended. Guy Maddalone has written numerous articles and authored books including, “How to Hire and Retain Your Household Help,” “How to Hire a Nanny,” and “How to Hire a Caregiver for Your Senior,” I love that Guy always recommends parents offer a generous pay and benefits package to help retain their household help.

GTM Payroll Services sets up a nanny payroll account including setup of federal and state tax IDs. Tax withholdings are automatically calculated and taxes are filed on time, every time –- 100% guaranteed.They provide a secure online account management and employee self-service system. GTM calculates payroll taxes, files them, and automates payroll to make paying household employees easy. If household employers have any trouble or questions they are known for having great customer service.

SurePayroll:

SurePayroll is cloud-based nanny payroll software. SurePayroll has a 100% tax filing guarantee, which means that if it makes a mistake while filing your taxes, it’ll deal with fines and penalties from the IRS instead of shoving the error off on you.

SurePayroll is also has a mobile app so parents can pay by their phone instead of their laptops. SurePayroll’s iOS and Android apps offer on-the-go payroll flexibility. SurePayroll includes these features: automatic state, local, and federal tax filing; new-hire state reporting; automated payroll runs; automatic direct deposit; and online employee pay stub access.

NannyChex:

NannyChex is not just payroll software. It’s a fully outsourced service, meaning the employer just enters some basic employee and pay rate info and the service takes care of the rest. NannyChex helps parents setup the Employer Identification Number needed to file taxes. The service provides automatic tax withholding and filing, direct deposit, new hire reporting, workers compensation audits. It tracks sick time, vacation time, and paid-time-off tracking.

Payroll by Wave:

Wave offers free accounting software but its payroll plans aren’t free. Wave can’t file taxes for parents in 41 states but it can calculate payroll taxes and directly deposit paychecks into their employees’ accounts at a low cost. In the remaining nine states, Payroll by Wave files payroll taxes for just $15 more than its already low price. It is super-cheap nanny payroll software that tackles some of the most important aspects of payroll.

Savvy Nanny:

Savvy Nanny starts at reasonable rate for up to four employees with a $50 year-end tax filing fee. While you have to email or call to sign up, subscribers can access live chat, phone, and email support six days a week. They file and pay all state and federal taxes. They provide Direct Deposit to the nanny’s account or allow employers to use their own checks. They email paystubs to the employee. They provide Schedule H for all 50 states.

NannyPay:

NannyPay software is licensed on an annual (365 day) subscription basis. NannyPay doesn’t manage direct deposit on the employer’s behalf and parents have to file all taxes themselves. But if parents want accurate calculations and easy-to-generate, signature-ready tax forms, NannyPay software can do it.