Social Security and Medicare (FICA) for Household Employees
Once you pay a household employee $3,000 or more in a calendar year, Social Security (6.2%) and Medicare (1.45%) apply to their wages — split evenly, with your employee's share withheld from their pay and your matching share paid by you. Combined, that's 15.3% of wages, split 7.65/7.65.
The rates, in plain terms
| Tax | Employee share | Employer share |
|---|---|---|
| Social Security | 6.2% | 6.2% |
| Medicare | 1.45% | 1.45% |
| Total | 7.65% | 7.65% |
On a $1,000 paycheck, that's $76.50 withheld from your employee's pay, and another $76.50 you set aside and pay yourself — not deducted from their check.
The $3,000 threshold
FICA doesn't apply from the very first dollar — it kicks in once you've paid $3,000 or more to that employee in the calendar year. Once you cross it, the tax applies retroactively to everything paid that year, not just going forward, which is why Sadie tracks a running year-to-date total rather than treating each paycheck in isolation.
Additional Medicare tax at higher pay
If a single household employee's wages from you exceed $200,000 in a year, an extra 0.9% Additional Medicare tax applies on the amount over that — employee-side only, no employer match. This is rare for household employment but worth knowing about.
Can you cover your employee's share yourself?
Yes — some families choose to pay both the employee and employer share themselves, so the worker's take-home pay isn't reduced. This is a generous but optional choice, not a requirement, and it slightly changes how the numbers are calculated (the amount you cover for them counts as additional taxable wages).
Frequently asked questions
Is FICA the same as the 'nanny tax'?
FICA is the biggest piece of it. The full nanny tax picture also includes federal unemployment tax and, in many states, a state unemployment tax.
What if I'm under the $3,000 threshold for the whole year?
Then FICA doesn't apply for that year — but confirm at year-end, since it's based on the full year's total, not just what you expected when you started.
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Watch the threshold without doing the math by hand.
Sadie tracks your year-to-date wages automatically and applies FICA the moment you cross $3,000 — no spreadsheet required.
This guide is general information, not tax or legal advice. Rules vary by state and change over time — confirm anything specific to your situation with a licensed professional or your state's labor department.