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

South Dakota SUTA runs 0% - 9.5% by claims history, before South Dakota's separate investment & administrative fees, 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

No. South Dakota has no state income tax, so there is nothing to withhold and no state return for your nanny to file.

• You still owe the federal baseline: FICA, FUTA and Schedule H
• South Dakota unemployment insurance still applies on the employer side

At least $11.85 an hour for a nanny in South Dakota.

• That is South Dakota's own minimum wage. The state exempts babysitters, which may not include a full-time nanny, so pay at least this rate
• South Dakota raises it to $12.30/hour from January 1, 2027
• 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

SDCL 60-11-3

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

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

These are the findings that come up most often for South Dakota 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 South Dakota unemployment insurance registration after crossing $1,000 in any calendar quarter (the federal household-employer trigger)
• Paying below $11.85/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.