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

Maine SUTA runs 0.22% - 5.4% by claims history, with a separate rate for new employers.

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

Usually not. Maine 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 Maine'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 $15.10 an hour for a nanny in Maine.

• That is Maine's own minimum wage, above the federal $7.25 floor
• Maine raises it to $15.70/hour from January 1, 2027
• Some cities set a higher floor, so check the rate where the work happens before you set one
• 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

Yes, paid family leave. Maine's paid family leave program covers household employees.

• Funding rules vary: some states are employee-funded, some split it between employer and employee
• You register and remit for it separately from unemployment insurance

These are the findings that come up most often for Maine 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 Maine unemployment insurance registration after crossing $1,000 in any calendar quarter
• Under-withholding Maine state income tax when the employee has elected withholding on the state W-4 equivalent
• Missing registration or under-withholding for Maine's state disability and/or paid family leave program
• Paying below $15.10/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.