What would the IRS flag about how you've been paying your nanny?

Delaware SUTA runs 0.1% - 8% by claims history, with a separate rate for new employers.

• You owe it once you pay $1,000 in any calendar quarter (the federal household-employer threshold)
• Filings are usually quarterly, with an annual reconciliation
• Your assigned rate moves over time, depending on whether former employees file unemployment claims

Usually not. Delaware has a state income tax, but withholding it from a household employee is optional unless your nanny asks for it.

• It is usually optional, and your nanny elects it on Delaware's W-4 equivalent
• If they do elect it, you owe quarterly remittance to the state and an annual reconciliation return that includes the W-2 you issued

At least $7.25 an hour for a nanny in Delaware.

• Delaware has its own minimum wage of $15.00/hour, but it does not cover nannies, so the federal floor governs instead
• Overtime is 1.5x pay for hours over 40 in a week, under the FLSA
• Live-in nannies are exempt from FLSA overtime, but not from minimum wage

19 Del. C. § 901(3)b

No. Delaware does not require state disability insurance or paid family leave for household employees.

• Your obligations are the federal baseline: FICA, FUTA and Schedule H
• Delaware state unemployment insurance still applies on the employer side

These are the findings that come up most often for Delaware household employers.

• Treating a household worker as a 1099 contractor when their schedule and duties make them a W-2 employee under IRS Publication 926
• Missing Delaware unemployment insurance registration after crossing $1,000 in any calendar quarter (the federal household-employer trigger)
• Under-withholding Delaware state income tax when the employee has elected withholding on the state W-4 equivalent
• Paying below $7.25/hour or skipping FLSA overtime, which is a Department of Labor (not IRS) finding

Federal exposure layers on top of all of these: no Schedule H filed, no W-2 issued, no EIN, and any FICA underpayment.