Confused about how being on payroll as a nanny actually works? Whether you’re new to providing in-home care or just looking to better understand your paycheck, let’s break down everything you need to know—no confusing jargon, no guesswork. Just your questions about nanny payroll explained!

1) What does being on payroll as a nanny actually mean?

Being “on payroll” means your employer is treating you as a legal employee, just like any other employee in a traditional job. You are being compensated as a household employee, not an independent contractor. That means they’re withholding taxes from your paycheck, reporting your wages to the IRS, and contributing to your Social Security and Medicare.

When we talk about nanny payroll, this is the foundation: you’re a household employee, not an independent contractor. Your employer is responsible for paying their share of employment taxes, issuing you a W-2 at the end of the year, and often helping you access benefits like paid time off or health stipends.

It also means your income is verifiable—a huge advantage when applying for a loan, renting an apartment, or planning for your future.

2) Net vs. Gross Pay: Why It Matters

One of the most common sources of confusion is the difference between gross pay and net pay.

• Gross pay is your total earnings before taxes and withholdings.
• Net pay is what you actually take home after taxes.

Let’s say your gross weekly pay is $1,000. After federal and state taxes, Social Security, and Medicare are withheld, your net pay might be closer to $750 (give or take, depending on your tax bracket and location).

Understanding this difference is essential when negotiating your salary. Always confirm if the rate discussed is gross or net, though it’s most likely gross (i.e., when you see a rate or rate range listed on a job posting). Gross pay is what should be outlined in your contract. From there, a payroll company or your employer will calculate your withholdings appropriately.

3) Why is my first paycheck delayed?

It’s totally normal (though frustrating!) for your first paycheck to be delayed by a week. Here’s why:

Most employers use a “one-week payroll lag”. That means your first paycheck covers your first full week of work, but it’s processed after that week ends. If you start work on a Monday, you’ll likely get paid the following Friday, which should cover the work you did in your first week.

This can catch people off guard if you’re used to same-week payments or daily rates. But once that initial delay passes, your pay should be consistent and on a set payroll schedule.

4) W-2 vs. 1099: What’s the difference and why it matters

This part is huge, especially when you’re comparing job offers. Many nannies still get offered 1099s, but here’s the deal:

• A W-2 means you’re a legal employee. Your employer handles tax withholdings and pays a portion of your employment taxes. You receive benefits, and your employment is documented.
• A 1099 means you’re classified as an independent contractor. You’re responsible for both the employer and employee share of taxes (hello, 15.3% self-employment tax), and you don’t receive benefits like paid time off.

Here’s the thing: nannies are not independent contractors. The IRS is clear about this. You work in someone’s home, follow their schedule, and use their tools, which makes you a household employee. Being misclassified can cause major issues down the line, both for you and your employer.

If you’re ever unsure about how your taxes are being handled, ask your employer for clarity. You deserve transparency.

Understanding payroll is more than just knowing when you get paid. It’s about financial empowerment, legal protection, and long-term stability. When you are on a payroll, you can step confidently into your professionalism, knowing exactly how your paycheck works and what you’re entitled to.