What would the IRS flag about how you've been paying your nanny?
Answer 12 questions. We'll check common federal and state household-employment issues and show you what needs review.
Educational only. Not tax, legal, or accounting advice. Consult a licensed tax professional for your specific situation.
How Kentucky household employer rules differ
Louisville (2.2% for residents) and Lexington (2.25%) charge occupational license taxes that NannyKeeper withholds for you. Many other Kentucky cities and counties charge one too, and a few exempt household employees.
State unemployment insurance (SUI). Kentucky requires household employers to register and pay state unemployment tax once wages cross its applicable threshold. New York and DC use $500 per quarter; many states use $1,000. 2026 unemployment tax rates in Kentucky: 0.3% - 9%. Missing the registration is one of the most common audit findings.
State income tax withholding. Kentucky has state income tax, which means you may need to withhold from your nanny's paycheck (it depends on whether they elect withholding on the state W-4 equivalent). If they do, you owe quarterly remittance and an annual state W-2 reconciliation.
Local income taxes. Kentucky has significant local income tax layers: the local occupational license tax applies in most cities and counties. Depending on where the employee actually works (resident vs. work locality), you may need to register with multiple local agencies.
Minimum wage. The minimum wage in Kentucky is $7.25/hour (federal). Paying below the rate that applies is a wage problem with the Department of Labor, separate from taxes and often more expensive, because you owe the back wages plus a penalty on top.
Kentucky household employer questions
The state-specific rules behind every finding.