5 Things You Need to Know About Employing a Nanny During COVID-19

How paid sick leave, expanded Family and Medical Leave Act, tax credits, and more can affect you and your nanny during the coronavirus pandemic

By NYMetroParents Staff April 27, 2020

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4. You can receive tax credits for your nanny’s paid sick or family leave.

The Families First Act provides reimbursable tax credits to help you offset the cost of providing paid sick leave and paid family leave to your nanny. The amount will depend on the type of leave your nanny needs to take.

• If your nanny is sick, you can receive up to $5,110 in tax credits for paid sick leave
• If your nanny needs to care for a sick family member, you can receive up to $2,000 in tax credits for paid sick leave.
• If your nanny cannot work because his child’s school or day care is closed due to the coronavirus, you can receive up to $10,000 in tax credits for paid family leave.

5. Your nanny may be eligible for an economic stimulus package payment.

The CARES Act may provide your nanny with a one-time payment of up to $1,200 ($2,400 if she’s married), plus an additional $500 for each child she have. She just needs to have a Social Security Number and have filed a 2018 or 2019 tax return to receive this payment. The IRS is distributing these stimulus payments via direct deposit if it has bank account information on record, or will mail a check to your nanny’s home.

An Important Reminder About Paying Nannies Legally

The employer tax credits, unemployment benefits, and stimulus payments all come with the caveat that families must be paying their nannies legally to be eligible. Both the IRS and the state need to have record of your nanny as a taxpayer and you as a household employer before any assistance is given. If you’ve paid your nanny off the books, a household employer payroll service, such as Care.com HomePay, can provide assistance. Due to the IRS extending the 2019 tax filing deadline to July 15, 2020, such services can get you caught up on your tax requirements so both you and your nanny can be eligible for the benefits highlighted above.