IRS Publication 926 – If you hire someone to work in your home — a nanny, housekeeper, gardener, or senior caregiver — you may be a household employer under IRS rules. IRS Publication 926 (2026), Household Employer’s Tax Guide, explains exactly what federal taxes you owe and how to report them correctly.
This is the latest official version (revised December 2025) and covers tax year 2026. Download it here: IRS Pub 926 PDF.
Who Is a Household Employee?
You have a household employee if you control what work is done and how it is done. Common examples include:
- Nannies and babysitters
- Housekeepers and maids
- Gardeners and yard workers
- Senior caregivers and home health aides
- Private drivers and cooks
Not household employees (generally):
- Independent contractors who offer services to the public
- Workers provided by an agency (if the agency controls the work)
- Family members in certain cases (spouse, child under 21, parent)
2026 Tax Thresholds and Rates
Here are the key triggers for federal employment taxes in 2026:
| Tax Type | Threshold (Cash Wages) | Employer Share | Employee Share | Total Rate | Wage Base Limit |
|---|---|---|---|---|---|
| Social Security + Medicare (FICA) | $3,000 or more per year | 7.65% | 7.65% | 15.3% | SS: $184,500 Medicare: Unlimited |
| Federal Unemployment (FUTA) | $1,000 or more in any calendar quarter | 0.6% (after credit) | None | 0.6% | First $7,000 per employee |
- Additional Medicare Tax (0.9%) applies only to the employee if wages exceed $200,000 in the year.
- Non-cash wages (meals, lodging) are usually not subject to FICA or FUTA.
Key Federal Tax Obligations
- Social Security & Medicare Taxes (FICA)
You must withhold the employee’s 7.65% share and pay your own 7.65% share. You can pay the employee’s share yourself (and treat it as additional wages). - Federal Unemployment Tax (FUTA)
Paid entirely by you (the employer). Most employers qualify for the full 5.4% state credit, reducing the net rate to 0.6%. - Federal Income Tax Withholding
Optional. Only required if the employee requests it on Form W-4 and you agree.
Forms You Must File
- Schedule H (Form 1040) — Report all household employment taxes on your personal tax return.
- Form W-2 — Issue to the employee (and file with SSA) if you paid $3,000+ in Social Security/Medicare wages or withheld income tax.
- Form W-3 — Transmit W-2s to the Social Security Administration.
- EIN — Get a free Employer Identification Number if you pay wages subject to employment taxes.
Due dates for 2026 taxes:
- File Schedule H with your 2026 Form 1040 by April 15, 2027 (or extension date).
- Give W-2s to employees by January 31, 2027.
- File Copy A of W-2/W-3 with SSA by January 31, 2027.
Recordkeeping Requirements
Keep these for at least 4 years:
- Employee’s name, address, SSN
- Dates and amounts of wages paid
- Copies of W-2, W-4, I-9
- Proof of tax payments
Can You Claim the Child and Dependent Care Credit?
Yes — if you pay a nanny or caregiver so you (and your spouse, if filing jointly) can work or look for work, you may qualify for the credit on Form 2441.
Common Pitfalls to Avoid
- Paying cash “under the table” → IRS audits can result in back taxes + penalties.
- Forgetting FUTA when wages hit $1,000 in one quarter.
- Assuming an agency worker is automatically not your employee.
- Missing state unemployment insurance or disability requirements (check your state).
Where to Get Help?
- Official guide: IRS Publication 926 (2026)
- Interactive tools: IRS.gov/ITA or eitcassistant.irs.gov
- Free tax help: VITA/TCE programs or IRS Taxpayer Assistance Centers
- Payroll services: Many specialize in household payroll (they handle withholding, filings, and W-2s).
Bottom line: Hiring help at home is common, but it comes with real tax responsibilities. Following IRS Publication 926 keeps you compliant, avoids penalties, and lets you focus on what matters — your family.
Need the latest updates? Always check IRS.gov/Pub926 for any changes after December 2025. Consult a tax professional for your specific situation.