Nanny Taxes & Payroll in New Jersey

Minimum Wage

Household employees must be paid at least the highest applicable federal, state, or local minimum wage rate. New Jersey’s minimum wage rate of $15.23/hour applies to employers with fewer than six employees.

Overtime Pay Rules

Household employees in New Jersey, including live-in workers, must 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 or when work is performed on a holiday.

State Unemployment Tax & Rate

In New Jersey, the new employer SUI (state unemployment insurance) rate is 2.8 percent on the first $44,800 of each employee’s wages. This includes the Workforce Development/Supplemental Workforce Funds contribution. Employers with previous employees may be subject to a different rate.

New Jersey is one of the few states that requires employees to contribute to unemployment insurance. On the first $44,800 of their wages, employees pay 0.3825 percent into unemployment insurance and 0.0425 percent into the Workforce Development/Supplemental Workforce Funds.

Workers’ Compensation Insurance

Household employers in New Jersey must have workers’ compensation coverage for all part-time and full-time employees. In New Jersey, you may be able to add workers’ compensation to your homeowner’s policy. If not, get a quote on workers’ compensation insurance.

Disability Benefits Insurance

Household employees in New Jersey also pay 0.23 percent of taxable wages for family leave insurance (FLI) and 0.19 percent for disability insurance. These rates apply to the first $171,100 in wages.

New employers pay 0.50 percent of the first $44,800 of each employee’s wages toward disability insurance. They do not pay into FLI.

Domestic Workers’ Bill of Rights

The New Jersey Domestic Workers’ Bill of Rights provides a range of rights and employment protections for household employees, including wage protections, anti-discrimination and anti-harassment rights, health and safety protections, and privacy rights.

Here are some of the domestic worker protection requirements for employers:

Work agreements

Families that employ household help must enter into a written agreement or nanny contract with any employee who works more than five hours a month. The contract must be in the employee’s language and include:

• job duties
• wages (including overtime)
• work schedule
• payment frequency
• breaks
• sleeping periods
• leave
• paid holidays
• transportation and housing details (if applicable)
• term of contract
• other agreed terms

The law also prohibits domestic worker employment contracts from including provisions that waive legal protections under federal, state, or local laws; mandating pre-dispute arbitration agreements; or containing non-disclosure, non-competition, or non-disparagement agreements.

Employers must also notify employees of their rights under the Domestic Workers’ Bill of Rights.

Meal and rest breaks

Household employees are now required to receive:

• At least one paid 10-minute break for every four consecutive hours of work unless the nature of the work prevents the domestic worker from being relieved from work for such period due to the nature of their job duties, which may include child care or care of the infirm, elderly, or disabled.
• A 30-minute lunch break after working more than five consecutive hours, unless the nature of the work precludes such breaks. Employees are considered on duty during this meal period. That means the meal period is compensable and should be part of overtime calculations unless they are relieved of all work duties and allowed to leave the work site.
• An unpaid day off after six days of work for live-in employees

Wage protections

While most household employees are already entitled to minimum wage and overtime, this new law removes the exclusion for part-time babysitters working in the employer’s home. New Jersey’s minimum wage is $15.23/hour for employers with fewer than six workers.

Termination notice

Employers must give at least two weeks’ notice before terminating a household employee and four weeks for a live-in employee, with exceptions for employee misconduct.

Other rights and protections

Household employees also gained privacy rights and protections against harassment and retaliation. Household employers must provide a notice of these rights.

Learn more about the New Jersey Domestic Workers’ Bill of Rights.

Paid Leave Laws

The New Jersey Paid Sick Leave law applies to all employers – including families that hire household help. Household employees can accrue up to 40 hours of paid sick leave at one hour for every 30 hours worked. While unused sick time must carry over to the following year, it can be capped at 40 hours. An employer can also offer to pay employees for their unused sick time at the end of the year. However, unused sick time earned but not used doesn’t need to be paid upon separation from employment. Employees start accruing paid leave 120 days after being hired. The law covers all full-time, part-time, and temporary employees.

Paid sick leave can be used for:

• Diagnosis, care, treatment of, or recovery from the employee’s own mental or physical illness, injury, or condition, including preventive care
• Caring for a family member during the diagnosis, care, treatment of, or recovery from a mental or physical illness, injury, or condition, including preventive care
• Time needed because the employee or family member is a victim of domestic or sexual violence. This includes:
  • Medical attention needed to recover from physical or psychological injury or disability caused by domestic or sexual violence
  • Services from a designated domestic violence agency or other victim services organization;
  • Psychological or other counseling
  • Relocation
  • Legal services such as obtaining a restraining order or participating in any civil or criminal proceedings related to domestic violence or sexual violence
• Times when the workplace, school, or childcare is closed by a public official’s order due to a public health concern.
• Attending a school-related conference, meeting, or function requested or required by the school

Employers must post a notice in a place accessible to workers and provide a written copy of that same notice to their employees.

Learn more about New Jersey’s Earned Sick Leave.

Other State Regulations

Worker Separation

Household employers must notify domestic workers before ending their employment. Most workers must be provided with two weeks’ notice, and live-in workers must be given four weeks’ notice.

If you don’t properly notify a worker, they may be entitled to severance pay based on their regular hours and pay. There are some exceptions to this notification rule, including:

• If the worker committed significant misconduct, like abuse or neglect.
• If the domestic worker is employed by an individual, not an agency, and that individual no longer needs the services. For example, if a patient dies and no longer needs senior care.

Household employers are required to report all employee separations to the state’s Department of Labor & Workforce Development, Division of Employer Accounts, through the Employer Access portal. This enables faster unemployment benefit determinations.

This requirement applies to all separations regardless of reason: termination, resignation, or retirement. Employers must provide separation information immediately when a worker becomes unemployed.

Employers who fail to report separations face penalties for willful failure to furnish reports.

For more information, visit Get Started with Employer Access.

Pay Frequency

Household employers in New Jersey must schedule a regular payday, and workers must be paid at least twice a month, no more than 10 days after the end of the pay period.

Final Pay

All wages are due to a departing household employee no later than the regular payday for the period during which the worker’s termination occurs.

Helpful Links for Nanny Taxes in New Jersey

• Domestic Workers’ Bill of Rights: What Employers Need to Know
• New Jersey Department of Labor and Workforce Development
• New Jersey Department of the Treasury/Division of Taxation
• New Jersey Earned Sick Leave

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