How to Become a Nanny Contractor in the U.S. | Hirelo
Learn how to become a self-employed nanny contractor in the U.S. Step-by-step guide on 1099 rules, taxes, contracts & invoicing with Hirelo.
More and more nannies in the United States are choosing to work as independent contractors instead of employees. Whether it is for greater flexibility, higher earning potential, or the ability to work with multiple families, becoming a 1099 nanny contractor can be a smart move.
But with self-employment comes responsibility, from understanding IRS rules to sending professional invoices and keeping your taxes in order. This guide walks you through every step so you can start your nanny contracting career the right way.
Step 1: Decide if Contracting is Right for You
As a contractor, you are running your own small business. That means:
You set your schedule and can work with multiple clients.
You negotiate your own rates without being locked into one employer’s pay scale.
You cover your own taxes (income tax, Social Security, Medicare).
You do not receive employee benefits like paid holidays or health insurance.
If you value independence and are comfortable managing your own admin, contracting could be the right fit.
Step 2: Understand IRS Classification Rules
The IRS uses specific criteria to determine if you are an employee or an independent contractor. Generally, you are a contractor if you:
Decide how and when you work.
Provide your own tools, supplies, or training.
Can work for multiple clients at once.
Families who hire you will issue a Form 1099-NEC at year-end if they have paid you $600 or more. Misclassification can lead to IRS penalties for both you and the family, so be sure your role meets contractor requirements.
Step 3: Choose Your Business Structure
In the U.S., many nanny contractors operate as:
Sole Proprietors (easiest to set up, use your SSN for tax filing).
LLCs (adds legal protection and may improve credibility).
Check your state’s registration requirements before you start.
Step 4: Get the Right Contracts in Place
A written nanny contractor agreement protects both you and your clients. It should clearly outline:
Duties and responsibilities
Hours and schedule
Pay rate and invoicing terms
Cancellation and termination policies
Having a signed contract not only prevents disputes but also strengthens your case if the IRS reviews your contractor status.
Step 5: Manage Your Taxes from Day One
As a contractor, you are responsible for:
Paying quarterly estimated taxes to the IRS.
Covering self-employment tax (Social Security and Medicare).
Keeping receipts for deductible expenses like mileage, supplies, or training courses.
The easiest way to stay on top of this is to use software that tracks income, expenses, and payments automatically.
Step 6: Use Payroll and Invoicing Tools to Stay Organised
Trying to manage everything manually can be stressful and risky if you miss a payment or deadline. That is why many U.S. nanny contractors use Hirelo, an all-in-one payroll and HR platform designed for domestic workers. With Hirelo you can:
Send professional invoices in seconds.
Track payments and overdue balances.
Keep all records in one secure place for tax time.
Ensure your payments are properly documented for IRS compliance.
Step 7: Market Your Services
Once you are set up, it is time to find clients. You can:
Join nanny placement agencies that work with contractors.
Advertise on local Facebook groups or childcare job boards.
Build a simple website or profile that highlights your experience and rates.
Final Thoughts
Becoming a nanny contractor in the U.S. gives you freedom and control over your career, but it also means managing your own business. With the right setup, contracts, and tools, you can focus on what you do best: providing exceptional childcare.
Ready to make nanny contracting easier?
Try Hirelo’s contractor payroll and invoicing tools built for nannies, busy parents, and agencies across the U.S.
