The $3,000 IRS threshold for babysitter taxes
If you pay one babysitter $3,000 or more in a calendar year, you owe employment taxes. Here's how fast common scenarios add up.
| Scenario | Annual Total | Taxes Required? |
|---|---|---|
| $50/week, occasional (every other week) | ~$1,300 | No |
| $25/night, twice a month | ~$600 | No |
| $75/week, every Saturday | ~$3,900 | Yes |
| $150/week, after-school care | ~$7,800 | Yes |
The tax credit that pays for itself
The Child and Dependent Care Credit
When you pay babysitter taxes legally, you can claim up to $1,050 for one child or $2,100 for two or more children on your tax return through the Child and Dependent Care Credit. You need to pay so both you (and your spouse) can work or look for work.
For many families, this credit is worth more than the cost of doing payroll.
Quick math
Payroll costs $10/month ($120/year). The credit can save you $1,050-$2,100. That's a return of 8-17x on your investment — before you even count the peace of mind.
Multiple babysitters? The $3,000 threshold is per person
If you pay one babysitter $1,500 and another $1,400, you don't owe taxes for either — even though you spent $2,900 total. The IRS tracks each worker separately. You only owe employment taxes when you pay a single babysitter $3,000 or more in a calendar year.
How NannyKeeper handles babysitter taxes
Once you cross the threshold, we take care of the rest
Accurate Tax Calculations
Federal, state, Social Security, Medicare—calculated to the penny for your specific situation.
Professional Pay Stubs
Itemized pay stubs your employee can use for apartments, loans, or their own tax filing.
Never-Miss Reminders
Email alerts before every deadline. No more "I forgot it was due."
Built-In Direct Deposit
Funds transfer automatically on payday. No checks to write or bank runs.
We Handle Your EIN
Need an Employer ID Number? We apply with the IRS on your behalf—no forms to navigate yourself.
W-2s & Schedule H
Your W-2s and household employment form, ready to download when tax season arrives.
We handle payroll for all types of household employees
Babysitter tax questions
The threshold is $3,000 for 2026. If you pay any single household worker $3,000 or more in a calendar year, you owe employment taxes. Previous years: $2,800 (2025), $2,700 (2024). The IRS adjusts this annually for inflation.
Looking for the complete guide?
Read our full babysitter tax article for a deeper dive into thresholds, deductions, and everything in between.
Read the full babysitter tax article