How do I register as a household employer in Michigan?

Start with a federal EIN, then register with Michigan 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 Michigan'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. If you will withhold Michigan income tax at your nanny's request, register separately with the state revenue department for a withholding account. You may also need a local income tax registration, depending on your nanny's work or home municipality. Detroit, Grand Rapids, Saginaw, and roughly 20 other Michigan cities collect local income tax, but Michigan doesn't let a household employer withhold it, so we don't take it from your nanny's pay. They report and pay it on their own city return.

What payroll taxes does Michigan charge for a household employee?

Federal FICA and FUTA, Michigan 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. Michigan SUTA: 0.05% - 10.78% on a state-specific wage base, with a separate rate for new employers. State income tax withholding is optional unless your nanny elects it on the state W-4. Local income tax may also apply. Detroit, Grand Rapids, Saginaw, and roughly 20 other Michigan cities collect local income tax, but Michigan doesn't let a household employer withhold it, so we don't take it from your nanny's pay. They report and pay it on their own city return.

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

At least $7.25 an hour for a nanny in Michigan. Michigan's own minimum wage of $13.73/hour only covers households with 2 or more employees, so the federal floor governs for a smaller household. 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: MCL 408.932(d).

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

Yes. Michigan 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 Michigan does not strictly require one.

What records do I need to keep for a Michigan 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. Michigan 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

Michigan Nanny Tax Guide

Michigan has a flat 4.25% state income tax. Detroit and about 23 other cities impose local income taxes, but Michigan doesn't let a household employer withhold them, so a nanny pays it on their own city return. The personal exemption significantly reduces taxable income.

Michigan household employer quick facts

Applies in Michigan

State income tax withholding
State unemployment

Not in Michigan

Disability insurance
Paid family leave

Minimum Wage

$7.25/hour

That is the federal floor, because the state's own rate only covers households with 2 or more employees.

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SUTA Rate Range

0.05% - 10.78%

New employers: 2.7% on the first $9,000 (2026). Michigan Unemployment Insurance Agency

Key things to know

Flat state income tax of 4.25%
Detroit city tax is not withheld from household employees
Personal exemption of $5,900
No state disability or paid family leave program; whether Michigan's Earned Sick Time Act covers a household is not yet settled

Michigan Employer Requirements

State Income Tax

Michigan uses a flat 4.25% income tax rate. A personal exemption of $5,900 per person substantially reduces taxable income.

Detroit City Tax

Detroit residents pay 2.4% city income tax and non-residents working in Detroit pay 1.2%. Michigan doesn't allow a household employer to withhold it, so your nanny files and pays it on their own Detroit return. Grand Rapids and about 22 other cities work the same way.

State Unemployment Insurance

Employers pay SUI tax on the first $9,000 of wages. New employer rate is 2.7%, with rates ranging from 0.05% to 10.78% based on experience.

Michigan household employer questions

What will it cost?

Wondering what you'll actually owe as a Michigan 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: Michigan tax agency, IRS Publication 926

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Michigan Nanny Tax Guide

Michigan household employer quick facts

Michigan Employer Requirements

State Income Tax

Detroit City Tax

State Unemployment Insurance

Michigan household employer questions

What will it cost?

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