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

Maryland SUTA runs 0.3% - 10.9% 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. Maryland 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 Maryland'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 $15.00 an hour for a nanny in Maryland.

• That is Maryland's own minimum wage, above the federal $7.25 floor
• Some cities and counties set a higher floor, so check your locality before you set a rate
• 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

US DOL, State Minimum Wage Laws

Not yet. Maryland Family and Medical Leave Insurance (FAMLI) starts collecting contributions on January 1, 2027, and it covers household employees.

• Maryland requires every employer with at least one employee in the state to register for it, households included
• From that date you withhold your employee's share from each paycheck; an employer with fewer than 15 employees pays no employer share
• You register and remit for it separately from unemployment insurance

These are the findings that come up most often for Maryland 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 Maryland unemployment insurance registration after crossing $1,000 in any calendar quarter (the federal household-employer trigger)
• Under-withholding Maryland state income tax when the employee has elected withholding on the state W-4 equivalent
• Missing local income tax registration in the employee's work or residence municipality
• Paying below $15.00/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.