Year-End Nanny Tax Checklist: December Prep Guide

December is here, which means it's time to prep for nanny tax season. A little work now saves a lot of stress in January.

Here's your complete year-end checklist.

Need a refresher? See our nanny taxes guide for rates and obligations.

Before December 31

1. Verify Your Records

Double-check that your records match reality:

• Total wages paid matches your bank records
• All withholding amounts are correct
• Your nanny's name and SSN are accurate
• Your EIN is correct

Errors now create problems in January.

2. Confirm Your Nanny's Information

You need accurate info for their W-2:

• Legal name (matches Social Security card)
• Social Security number
• Current mailing address

If anything changed during the year, update it now.

3. Run Final Payroll

Process your last payroll of the year:

• Include any December wages
• Calculate final withholding amounts
• Record year-to-date totals
• Issue final pay stub

4. Consider Year-End Bonuses

Planning to give a holiday bonus? Remember:

• Cash bonuses are taxable wages
• Gift cards are taxable wages
• Non-cash gifts under $75 may be excludable
• Add bonus amounts to W-2 wages

If you give a $500 bonus, withhold taxes like any other wages.

5. Review FSA/Dependent Care Credits

Did you use a Dependent Care FSA or plan to claim the Child Care Credit?

• Verify you have employer EIN for tax forms
• Confirm total childcare expenses
• Keep receipts and pay stubs

Maximum FSA contribution for 2025: $5,000 (married filing jointly)

January Tasks

By January 15: Pay Q4 Estimated Taxes

Final quarterly payment for 2025:

• Calculate what you owe
• Pay via IRS Direct Pay or EFTPS
• Pay state unemployment taxes

By January 31: W-2 Deadline

Give to your nanny:

• Copy B - For filing federal return
• Copy C - For their records
• Copy 2 - For filing state return

Send to Social Security Administration:

• Copy A of W-2
• W-3 transmittal form

Filing options:

• Electronic filing at ssa.gov/employer
• Mail to Social Security Administration

Prepare Schedule H

Schedule H reports household employment taxes on your personal return:

• Total wages paid
• Social Security and Medicare taxes
• Federal unemployment tax
• Income tax withheld

You'll file this with your Form 1040 by April 15.

Year-End Tax Calculations

Here's what you should have paid in 2025:

*After state credit

Example: If you paid $40,000 in wages:

Common Year-End Questions

What if I overpaid estimated taxes?

You'll get a refund when you file your return, or you can apply the overpayment to next year.

What if I underpaid?

Pay the difference with your return. If you underpaid significantly, you may owe a penalty—but it's usually minor for household employers.

My nanny left mid-year—do I still need to file?

Yes. Issue a W-2 for whatever wages you paid, even if they only worked part of the year.

Can I amend last year's W-2?

Yes, file Form W-2c (Corrected Wage and Tax Statement) if you find errors on previously issued W-2s.

NannyKeeper Year-End Features

If you use NannyKeeper, we've got you covered:

• Automatic W-2 generation — Download in January
• Schedule H preparation — Numbers ready for your tax return
• Year-end summary — All your totals in one place
• Deadline reminders — We'll remind you before January 15 and 31

No manual calculations required.

Year-End Checklist Summary

Start checking items off now, and January will be stress-free.

Get your W-2s ready →