Nanny Taxes in Maine

Minimum Wage

Household employees must be paid at least the highest of the federal, state, or applicable local minimum wage rates. Maine’s state minimum wage of $14.65/hour applies. However, Portland’s local minimum wage rate is $15.50/hour and may change annually based on a cost of living increase. Rockland’s minimum wage is also $15.50/hour. Each January 1, Rockland will adjust its rate based on the consumer price index.

Overtime Pay Rules

Household employees in Maine are required to be paid at least time and a half for hours worked over 40 in a seven-day workweek. Overtime compensation is not required for live-in employees.

State Unemployment Tax & Rate

The new employer SUI (state unemployment insurance) rate in Maine is 2.41 percent on each employee’s first $12,000 of wages. This rate includes a competitive skills scholarship fund assessment (0.14 percent) and an unemployment program administrative fund assessment (0.16 percent). This is an employer-only tax.

Workers’ Compensation Insurance

Household employers in Maine are not required to have workers’ compensation coverage for full- or part-time employees. However, you can choose a voluntary policy to protect you and your employee. Get a quote on workers’ compensation insurance.

Disability Benefits Insurance

The state has no disability benefits rules related to nanny tax and payroll.

Domestic Workers’ Bill of Rights

The state has no domestic workers’ bill of rights.

Paid Leave Laws

Maine’s paid family and medical leave program will cover all employers with one or more employees working in Maine. Employers and employees started contributing to a paid Family and Medical Leave Insurance Fund on January 1, 2025. Benefits will become available on May 1, 2026.

To be eligible, employees must have earned wages in Maine at least six times the state average weekly wage during the first four of the last five completed calendar quarters immediately preceding the first day of an individual’s benefit year. Using the current Maine average weekly wage of $1,144.67, employees who earn at least $6,868 in the year before taking leave are covered.

Employees can take up to 12 weeks of paid leave in a benefit year for any one or a combination of covered reasons.

Family leave may be taken to:

• Bond with their child during the first 12 months after the child’s birth or during the first year after placement of the child through foster care or adoption
• Care for a family member with a serious health condition such as an illness, injury, impairment, pregnancy, recovery from childbirth, or physical, mental, or psychological condition that involves inpatient care in a medical treatment center or continuing treatment by a healthcare provider
• Attend to a qualifying exigency related to a family member’s active duty service as determined pursuant to the federal Family and Medical Leave Act
• Care for a family member who is a covered service member
• Take “safe leave”

A “family member” includes a parent, grandparent, grandchild, sibling, spouse, or any other individual with whom the covered employee has a significant personal bond that is like a family relationship.

Medical leave may be taken for:

• Serious health condition of the employee or a family member
• The birth of the employee’s child or placement of a child under 16 years through adoption
• The donation of an organ by that employee for a human organ transplant
• The death or serious health condition of a family member

To fund the program, employers must remit premiums to the program every quarter in the amount of not more than 1.0% of wages for each Maine employee. The premium amount is split evenly between employer and employees. However, there is no employer contribution for employers with fewer than 15 employees, which likely includes household employers in the state. They are only required to remit the employee’s share (50% of the required premium – or 0.5% of wages – to the fund), or the employer can choose to pay this premium on their employee’s behalf.

Under the program, employees are entitled to receive a weekly benefit amount while on leave equal to 90% of the portion of the employee’s average weekly wage that is equal to or less than 50% of the state average weekly wage and 66% of the portion of the employee’s average weekly wage that is more than 50% of the state average weekly wage, all up to a maximum weekly benefit equal to the state average weekly wage.

Household employers must register with the Maine Leave Contributions Portal to make payments. The first payment is due by April 30, 2025.

More information on Maine’s Paid Family and Medical Leave.

Other State Regulations

State law in Maine requires household employers to pay their workers leaving employment in full no later than the next established payday. In addition, the law provides that “whenever the terms of employment or the employer’s established practice include provisions for paid vacations, vacation pay on cessation of employment has the same status as wages earned.”

Helpful Links for Nanny Taxes in Maine

• Maine Department of Labor
• Maine Revenue Services

Federal Regulations

All household employers need to follow certain federal regulations, including:

Fair Labor Standards Act (FLSA) Classification Guidelines

• Household workers are considered employees and not independent contractors. Learn more about misclassifying employees as independent contractors.
• Household workers are also non-exempt employees, meaning they receive at least time-and-a-half for hours worked over 40 per workweek. Learn more about overtime pay.

FICA Taxes

Social Security and Medicare taxes are commonly referred to as FICA taxes.

If you pay cash wages of $3,000 or more to any household employee in 2026 (or paid a domestic worker $2,800 or more in 2025), you must withhold and pay FICA taxes. FICA taxes are 15.3 percent of cash wages.

As an employer, you pay 7.65 percent (6.2 percent for Social Security and 1.45 percent for Medicare).

Your employee's share is also 7.65 percent, which you may withhold from their wages or pay yourself.

You don't withhold or owe FICA taxes on wages you pay to your spouse, child under the age of 21, parent, or any employee under 18 at any time during the calendar year.

Federal Unemployment Tax (FUTA)

If you pay a household employee total cash wages of $1,000 or more in any calendar quarter, you'll owe federal unemployment tax. This is an employer-only tax. FUTA is 6% of cash wages on the first $7,000 of wages paid to an employee.

Mileage Reimbursement

If your employee uses their own car in the course of their work, you can reimburse them for mileage. For 2026, the IRS has set the optional standard mileage rate at 72.5 cents per mile driven. Paying mileage is not mandatory in most states, and you can reimburse your employee at a different rate. However, if mileage costs cause your employee to fall below the minimum wage, you must reimburse them for mileage.

Remitting Taxes Quarterly

Household employers can remit taxes, including FICA, employee income, and federal unemployment, quarterly using Form 1040-ES. If a household employer does not remit their taxes quarterly, the entire amount will be due when they file their personal tax return. This could cause an underpayment penalty.

Year-End Requirements

By January 31, household employers must provide Form W-2 to their employees and submit Form W-3 and Copy A of Form W-2 to the Social Security Administration. Then, a household employer must file Schedule H with their personal tax return. Learn more: How to File Schedule H