Nanny Taxes in Washington State

Household employers need to comply with tax, wage, and labor laws that affect nannies, in-home senior caregivers, and other household employees. While federal laws cover employers in all states, there are also state- and city-specific regulations that employers must follow. Here’s what you need to know about nanny taxes in Washington state.

Washington Minimum Wage

Household employees must be paid at least the highest of the federal, state, or applicable local minimum wage rates. Washington’s minimum wage rate of $16.28 applies. The state’s minimum wage rate is adjusted annually to reflect changes in the cost of living. Washington allows employers to pay workers who are 14 or 15 years of age 85 percent of the state minimum wage rate. For 2024, the youth employment rate will be $13.83/hour.

In Seattle, the rate is $19.97/hour or $17.25/hour if you contribute at least $2.72/hour toward an employee’s medical benefits.

In Tukwila, the minimum wage rate is $16.99/hour.

Overtime

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

Washington State Unemployment Tax & Rate

In Washington, new employers will pay 90 percent of the average state unemployment (SUI) tax rate for all businesses in their respective industries, with the minimum rate being 1.00% as set by federal law. This applies to the first $68,500 of wages for each employee. Employers with previous employees may be subject to a different rate. This is an employer-only tax.

Workers’ Compensation Insurance

Household employers in Washington are required to carry workers’ compensation coverage if two or more employees each work 40 or more hours per week, or if an employee is providing nursing care. Workers’ compensation can be purchased through the Washington State Department of Labor and Industries.

Seattle Domestic Worker Protections

Seattle’s domestic worker protection law provides minimum wage, days of rest, civil rights protections, and meal break rights to nannies, senior caregivers, and other employees who work in a private home. The law includes full-time, part-time, and temporary household employees. Household employers must also follow document retention rules.

Seattle’s domestic worker protection laws provide:

• right to earn Seattle’s minimum wage
• 30-minute uninterrupted meal period when the shift is more than five consecutive hours
• 10-minute uninterrupted rest break for each four consecutive hour shift.
• One day of rest after six consecutive days worked.
• Hiring entities are not allowed to retain an employee’s original documents or personal effects (e.g. passport)

Learn more about Seattle’s domestic worker protections.

Paid Family and Medical Leave

Washington’s Paid Family and Medical Leave program (PFML) allows household employees to receive up to 12 weeks of paid leave for:

• Bonding after the birth or placement of a child
• An employee’s serious health condition
• A serious health condition of a qualifying family member
• Certain military events

Family members include:

• Child (including biological, adopted, or foster child, a stepchild, or a child to whom the employee stands in loco parentis, is a legal guardian, or is a de facto parent, regardless of age or dependency status)
• Parent (including biological, adoptive, de facto, or foster parent, stepparent, or legal guardian of an employee or the employee’s spouse or state-registered domestic partner or an individual who stood in loco parentis to an employee when the employee was a child)
• Grandchild
• Grandparent
• Spouse, child’s spouse, or state-registered domestic partner of an employee
• Sibling
• Any individual who regularly resides in the employee’s home or with whom the relationship creates an expectation that the employee cares for the person and that individual depends on the employee for care

Employees can also use paid family leave for bereavement purposes during the seven calendar days after the death of a qualifying family member.

The mandatory contribution is 0.74 percent of gross wages up to the Social Security cap of $168,600. Since families with household help likely have less than 50 employees, they are not required to pay the employer share (28.57 percent) of the contribution. They must still collect the employee portion (71.43 percent) or opt to pay this for their worker and submit those premiums every quarter. Employers must also report a worker’s wages, hours worked, and other information to the Employment Security Department.

The maximum weekly benefit will also be capped at $1,456.00 per week.

Benefits provide a percentage of the employee’s gross wages while the employee is on approved leave. Employees must have worked a total of at least 820 hours for any Washington employers during the previous 12 months to be eligible for paid leave.

Employers can provide paid family and medical leave benefits either through the state-run program, or purchase a voluntary private plan that provides benefits equal to or greater than the state minimum requirements.

Download the required poster and notices in the workplace.

Learn more about Washington Paid Family and Medical Leave.

Paid Sick Leave

Under the state’s paid sick law, virtually all Washington employers, including household employers, are required to provide paid sick leave to their workers.

Employees accrue a minimum of one hour of paid sick leave for every 40 hours worked. Paid sick leave must be provided to an employee regardless of their full-time, part-time, temporary, or seasonal status. All hours that an employee works must be counted towards accrual, regardless of how many hours they work in a given week or pay period, including overtime hours. A new employee begins accruing paid sick leave on their first day of work.

There is no cap on the amount of paid sick leave hours an employee can accrue within a year. Unused paid sick leave balances of 40 hours or less must carry over from one year to the next.

Employees must be allowed to use their accrued paid sick leave no more than 90 calendar days after they start work. After that, they must be allowed to use accrued paid sick leave in a manner consistent with normal payroll practices, but no more than 30 days after it is earned.

Employers must record and credit accrued paid sick leave to an employee’s available balance during usual pay cycles (e.g., weekly, biweekly, semi-monthly, monthly, etc.).

At least once a month, employees must be given a notice that shows:

• the amount of paid sick leave they accrued since the previous notice,
• the amount of paid sick leave used since the previous notice, and
• the employee’s current, unused paid sick leave balances available for use

Employees can use paid sick leave for themselves or their family members for any of the following reasons:

• A mental or physical illness, injury, or health condition.
• To diagnose, care for, or treat a mental or physical illness, injury, or health condition.
• To receive preventive medical care.
• For leave that qualifies under the state’s Domestic Violence Leave Act.
• If an employee’s workplace, or their child’s school or place of care, has been closed by order of a public official for a health-related reason.
  Note: Employers may allow employees to use paid sick leave for additional purposes.

Family members include:

• Child (biological, adopted, foster, stepchild, etc.), regardless of age or dependency status
• Parent (biological, adoptive, foster, stepparent, etc.), or the parent of the employee’s spouse or registered domestic partner
• Spouse or registered domestic partner
• Grandparent
• Grandchild
• Sibling

For more information, visit Washington State Paid Sick Leave Requirements.

WA Cares Fund

WA Cares Fund is the state-operated public insurance program to pay for long-term care services.

Beginning in July 2023, employers must collect 0.58% of an employee’s gross wages for the fund. Employers are required to report their employees’ wages and hours and pay premiums every quarter starting with the third quarter of 2023 (period beginning October 1, 2023). Employers can report for both the WA Cares Fund and PFML at the same time, on the same report.

Unlike PFML, premium contributions are not capped at the taxable maximum for social security.

All full-time, part-time, and temporary workers in Washington contribute to the WA Cares Fund.

Employees receive a long-term care benefit of up to $36,500. Benefits become available on July 1, 2026

For more information, visit WA Cares Fund Employer Information.

Helpful Links for Nanny Taxes in Washington

Washington Department of Labor and Industries

Washington Department of Revenue

Seattle Domestic Workers Ordinance

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, which means they receive overtime pay of 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 $2,700 or more to any household employee in 2024 (or paid a domestic worker $2,600 or more in 2023), then you need to 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 can withhold from their wages or choose to pay it 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 the age of 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 six percent of cash wages on the first $7,000 you pay an employee.

Mileage Reimbursement

If your employee uses their own car in the course of their work, you can reimburse them for mileage. For 2024, the IRS has set the optional standard mileage rate at 67 cents per mile driven. Paying mileage is not mandatory or you can reimburse your employee at a different rate. However, if the cost of mileage causes your employee to fall below minimum wage, then you need to reimburse them for mileage.

GTM Can Help with Nanny Taxes in Washington State

Call (800) 929-9213 for a free, no-obligation consultation with a household employment expert. We’ll answer all your questions and show you how to comply with wage, tax, and labor laws as a household employer. Or, if you’re ready to have GTM Payroll Services handle it all for you, get started with our nanny payroll and tax service.

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