How do I register as a household employer in Arizona?

Start with a federal EIN, then register with Arizona for each account that applies to you. Apply for a federal EIN at IRS.gov. It is free and takes about 15 minutes. Register with Arizona's unemployment insurance agency once you cross $1,000 in any calendar quarter. Most states want this within 20 days of becoming a covered employer.

What payroll taxes does Arizona charge for a household employee?

Federal FICA and FUTA, Arizona SUTA, and anything else below that applies to you. Federal FICA: 7.65% employer share, matched by your nanny. Federal FUTA: 6.0% on the first $7,000, an effective 0.6% after the state SUTA credit. Arizona SUTA: 0.03% - 8.36% on a state-specific wage base, with a separate rate for new employers. No state income tax withholding required for household employees, though the wages stay taxable to your nanny on their own Arizona return.

What are Arizona's minimum wage and overtime rules for nannies?

At least $15.15 an hour for a nanny in Arizona. That is Arizona's own minimum wage, above the federal $7.25 floor. Some cities and counties may 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. Source: US DOL, State Minimum Wage Laws.

Can I require my nanny to use direct deposit in Arizona?

Yes. Arizona allows direct deposit for household employees. Federal Regulation E still applies: your nanny must be free to choose their own bank, or you offer another payment method. Get a written, signed authorization before the first deposit, even though Arizona does not strictly require one.

What records do I need to keep for a Arizona household employee?

Keep them for at least 4 years after the return reporting the tax was due, or the tax was paid, whichever is later. Timesheets, pay stubs, W-2 copies, payment confirmations and SUTA filings. Arizona follows the federal baseline, so 4 years covers both. Most household-employer audits open with the IRS or a state agency asking for exactly these records, so keep them with your tax filings. Source: IRS Publication 926.

All State Guides

Arizona Nanny Tax Guide

Arizona exempts wages paid for domestic service in a private home from state income tax withholding. Household employers don't withhold AZ state income tax from their nanny's paycheck, though the nanny remains responsible for any income tax they owe at year-end. Employer-side SUI (state unemployment) is still required.

Arizona household employer quick facts

Applies in Arizona

State unemployment

Not in Arizona

State income tax withholding
Disability insurance
Paid family leave

Minimum Wage

$15.15/hour

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SUTA Rate Range

0.03% - 8.36%

New employers: 2% on the first $8,000 (2026). Arizona Department of Economic Security

Key things to know

No state income tax withholding for domestic workers
State minimum wage is $15.15/hour
No state disability or paid family leave program, but paid sick leave is required: 1 hour per 30 hours worked, up to 24 hours a year
Employer SUI still required on the first $8,000 in wages

Arizona Employer Requirements

State Income Tax (Exempt)

Arizona law prohibits household employers from withholding state income tax on wages paid for domestic service in a private home, per ARS § 43-403(A)(2) and AZ DOR ruling WTR 16-3. This applies even if both parties want to withhold voluntarily. Your nanny is responsible for paying any AZ income tax they owe when they file their return (typically via quarterly estimated payments or a refund adjustment).

State Unemployment Insurance

Employers pay SUI tax on the first $8,000 of wages. New employer rate is 2.0%, with 2026 rates ranging from 0.03% to 8.36% based on experience.

Workers' Compensation

Arizona doesn't require workers' compensation for household employers, since domestic workers are excluded from the state's coverage mandate. It's still worth considering: it protects your employee if they're injured at work, and protects you from potential liability.

Arizona household employer questions

What will it cost?

Wondering what you'll actually owe as a Arizona employer? Adjust the numbers below to get a quick estimate of your annual tax obligations.

This guide is for informational purposes only and should not be considered legal or tax advice. Tax laws change frequently. Always verify current requirements with your state's tax agency or consult with a qualified tax professional.

Verified accurate as of June 2026Sources: Arizona tax agency, IRS Publication 926

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Arizona Nanny Tax Guide

Arizona household employer quick facts

Arizona Employer Requirements

State Income Tax (Exempt)

State Unemployment Insurance

Workers' Compensation

Arizona household employer questions

What will it cost?

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