How do I register as a household employer in Vermont?

First, apply for a federal EIN at IRS.gov — free, takes about 15 minutes. Then register with Vermont's unemployment insurance agency once you cross $1,000 in any calendar quarter — most states require registration within 20 days of becoming a covered employer. If you'll withhold Vermont state income tax at your employee's request, register separately with the state department of revenue for a withholding account.

What payroll taxes does Vermont charge for a household employee?

Federal: 7.65% FICA (employer share, matched by your employee), plus FUTA at 6.0% on the first $7,000 (effective 0.6% after the state SUTA credit). Vermont SUTA: 0.5% - 5.6% on a state-specific wage base — new employers typically land near the middle of that range. State income tax withholding is optional unless your nanny elects it on the state W-4.

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

Vermont's minimum wage is $14.42/hour, above the federal $7.25 floor. Household employees must be paid at least this rate. FLSA overtime (1.5x for hours over 40 in a week) applies to most household employees. Live-in nannies are FLSA-exempt from overtime but not from minimum wage.

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

No. Vermont prohibits employers from mandating direct deposit — your nanny must opt in voluntarily. Vermont also requires the authorization to be in writing. Federal Regulation E (Electronic Fund Transfer Act) sets the floor; Vermont layers an additional employee-consent rule on top.

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

IRS Publication 926 requires household employers to keep employment tax records for at least 4 years after the tax becomes due or is paid, whichever is later. Records include timesheets, paystubs, W-2 copies, ACH/payment confirmations, and SUTA filings. Vermont follows the federal 4-year baseline for state purposes. Keep payroll records together with your tax filings in one organized place — most household employer audits start with the IRS or state agency asking for these records.

All State Guides

Vermont Nanny Tax Guide

Vermont has a progressive income tax. Its private-sector Family and Medical Leave Insurance program is voluntary rather than a required payroll contribution.

Vermont household employer quick facts

State Income Tax Withholding

State Unemployment

Disability Insurance

Paid Family Leave

Minimum Wage

$14.42/hour

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SUTA Rate Range

0.5% - 5.6%

New employers: 1% on the first $15,400 (2026). Vermont Department of Labor

Key things to know

Progressive state income tax (3.35% - 8.75%)
Voluntary family and medical leave insurance is available
State minimum wage is $14.42/hour
Personal exemption of $5,450

Vermont Employer Requirements

State Income Tax

Vermont uses progressive tax brackets: 3.35% to $45,400, 6.6% to $110,050, 7.6% to $229,550, and 8.75% above. Personal exemption is $5,450.

Paid Family and Medical Leave

Vermont's private-sector Family and Medical Leave Insurance program is voluntary. Employers or employees may purchase coverage, but there is no mandatory household-employer payroll contribution.

State Unemployment Insurance

Employers pay SUI tax on the first $15,400 of wages. New employer rate is 1.0%, with rates ranging from 0.5% to 5.6% based on experience.

Vermont household employer questions

What will it cost?

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

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Vermont Nanny Tax Guide

Vermont household employer quick facts

Vermont Employer Requirements

State Income Tax

Paid Family and Medical Leave

State Unemployment Insurance

Vermont household employer questions

What will it cost?

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