How to Pay a Nanny for an Overnight Stay: Overtime and Taxes

To pay a nanny for an overnight stay, you owe wages for every hour the nanny is on your premises during any shift shorter than 24 hours, including hours spent sleeping, plus overtime at one-and-a-half times the regular rate for any hours beyond 40 in the workweek. Only a shift of 24 hours or more lets you exclude up to eight hours of sleep from paid time, and only if you meet strict conditions in advance. On top of wages, once you pay a household employee $3,000 or more in cash during 2026, you owe Social Security, Medicare, and unemployment taxes as a household employer.¹

The 24-Hour Rule Decides What You Pay For

Federal regulations draw a hard line at 24 hours. Which side of that line your nanny’s shift falls on determines whether any sleep time can be pulled out of the paycheck.

Shifts Under 24 Hours

If your nanny arrives Friday at 6 p.m. and leaves Saturday at 8 a.m., that 14-hour stretch is a sub-24-hour shift. Every minute counts as hours worked, even if the nanny sleeps six of those hours undisturbed. It doesn’t matter that you provided a bed or that the children never woke up. An employee on duty for less than 24 hours is considered working the entire time, even when permitted to sleep or handle personal activities during quiet periods.² The common mistake is assuming sleep hours on a single overnight can be paid at a lower rate or skipped. They can’t.

Shifts of 24 Hours or More

When a shift reaches 24 hours, like a weekend trip that runs Friday evening through Sunday morning, you and the nanny may agree in advance to exclude up to eight hours of sleep from paid time.³ The deduction is not automatic. Three conditions all have to be met:

A written agreement, signed before the shift, spelling out the scheduled sleep period (for example, 10 p.m. to 6 a.m.). Without an agreement, the full sleep window is paid.
Adequate sleeping facilities. Federal rules require a private space with a real bed, not a couch in a room where the household is still moving around.
At least five hours of actual sleep during the scheduled period. Every interruption to attend to a child counts as paid time, and if interruptions cut sleep below five hours, the entire eight-hour block becomes compensable.³

Families with infants or toddlers who wake often should budget assuming the deduction won’t survive the night.

These rules apply to a nanny who normally lives elsewhere. A nanny who actually resides in the household as a regular living arrangement falls under a separate framework with more flexibility around sleep and meal deductions but no overtime pay.⁴ A nanny who sleeps over twice a month while you travel is not a live-in employee, so don’t assume those looser rules apply.

Overtime Applies to Overnight Hours

For a nanny who doesn’t live with you, federal law requires overtime pay at 1.5 times the regular hourly rate for every hour beyond 40 in a seven-day workweek.⁵ All those non-deductible sleep hours on a sub-24-hour shift count toward the 40-hour total. A nanny who works 35 regular hours during the week and then stays for a 14-hour Friday overnight has logged 49 hours, with 9 at the overtime rate.

Watch for hours the nanny worked without being asked. Under the “suffered or permitted” standard, if the nanny checks on a child, cleans up after bedtime, or handles any task you know about or should know about, that time is compensable and feeds the overtime count.⁶

A Worked Example

Say your nanny earns $20 per hour and has already worked 36 hours Monday through Thursday. You leave Friday at 5 p.m. and return Saturday at 9 a.m. That’s a 16-hour overnight. Because the shift is under 24 hours, all 16 hours are compensable.

The first 4 hours (Friday 5–9 p.m.) bring the weekly total from 36 to 40, paid at $20 = $80.
The remaining 12 hours (Friday 9 p.m. to Saturday 9 a.m.) are over 40, paid at $30 = $360.
Gross pay for the overnight: $440.

Now change the scenario. Same nanny, but she arrives Friday at 5 p.m. and stays through Sunday at 5 p.m. That’s a 48-hour shift, so the sleep-time deduction is on the table. With a written agreement and adequate sleeping facilities, you could exclude up to 8 hours per night, or 16 hours total, dropping the compensable hours from 48 to 32. Combined with the 36 hours already worked, the weekly total would be 68 hours, with 28 at the overtime rate. If the children wake her repeatedly one night and she gets fewer than five hours of sleep during the scheduled period, the deduction for that night disappears and those 8 hours are back on the clock.

Many states and cities set minimum wages well above the federal $7.25.⁷ If you offer a flat nightly stipend, divide it by total compensable hours to confirm it clears the highest applicable minimum. If it doesn’t, raise it.

The Taxes You Owe as a Household Employer

Once you pay a household employee $3,000 or more in cash wages during 2026, you owe Social Security and Medicare taxes.¹ This is the “nanny tax,” and a single multi-day overnight trip can push a family past the threshold without warning.

Social Security and Medicare

You withhold 6.2% for Social Security and 1.45% for Medicare from the nanny’s wages, and you pay a matching 6.2% and 1.45% yourself.⁸ Total: 15.3% of gross wages, split evenly. Some families cover the employee’s share as a benefit, which is allowed but raises the total cost.

Federal Unemployment Tax

Pay household employees $1,000 or more in any calendar quarter and you also owe FUTA. The rate is 6.0% on the first $7,000 of each employee’s annual wages, though a credit of up to 5.4% typically brings the effective rate to 0.6%. FUTA comes entirely from the employer; nothing is withheld from the nanny.¹

Federal Income Tax Withholding

You aren’t required to withhold federal income tax from your nanny’s pay. You only withhold if the nanny asks and you agree.¹ If you don’t, the nanny handles estimated payments on her own. Many nannies prefer withholding so they aren’t hit with a big April bill.

Filing and Deadlines

You need an Employer Identification Number (EIN) to file household employment tax forms; apply free at IRS.gov/EIN.¹ Give your nanny a W-2 and file copies with the Social Security Administration by February 1, 2027 for the 2026 tax year. Report household employment taxes on Schedule H, attached to your Form 1040, by April 15, 2027.

Records to Keep

Federal regulations require household employers to keep pay records for at least three years.⁹ For overnight shifts, document:

Shift start and end times.
The scheduled sleep period on any shift of 24 hours or more.
Each sleep interruption and how long it lasted.
Total compensable hours after applying or denying the sleep deduction.

A time log signed by both parties at the end of each shift works. Pay by direct deposit or check so there’s a traceable record, and provide a pay stub that breaks out regular hours, overtime hours, gross pay, and each tax withholding. Household payroll services generally run $40 to $75 per month and handle withholding and year-end filings if you’d rather not run the numbers yourself.

What It Costs to Get Wrong

A nanny who was underpaid can recover the unpaid wages plus an equal amount in liquidated damages, effectively doubling the bill, and attorney’s fees and court costs get added on top.¹⁰ The statute of limitations is two years from each violation, or three years if willful.¹¹ A nanny who leaves your employment can look back through years of overnight shifts and claim every unpaid hour at once. Willful violations can also draw civil penalties of up to $1,100 each.¹²

State and Local Rules Can Add More

Federal law sets the floor. Roughly a dozen states have passed domestic workers’ bills of rights that add mandatory written contracts, rest periods, and lower overtime thresholds (some states trigger overtime at 44 or 45 hours instead of 40). Several major cities have similar ordinances, and your state may require state unemployment insurance contributions separate from FUTA. If your state or city minimum wage is higher than $7.25, that higher rate replaces the federal figure in every calculation above. Check your local wage and hour rules before scheduling an overnight; the federal rules described here are the minimum, and many jurisdictions demand more.

1
Internal Revenue Service. Publication 926 (2026), Household Employer’s Tax Guide
2
eCFR. 29 CFR 785.21 – Less Than 24-Hour Duty
3
eCFR. 29 CFR 785.22 – Duty of 24 Hours or More
4
U.S. Department of Labor. Fact Sheet 79B – Live-in Domestic Service Workers Under the FLSA
5
U.S. Department of Labor. Fact Sheet 23 – Overtime Pay Requirements of the FLSA
6
eCFR. 29 CFR 785.11 – General
7
U.S. Department of Labor. Minimum Wage
8
Internal Revenue Service. Topic No. 751, Social Security and Medicare Withholding Rates
9
eCFR. 29 CFR 552.110 – Recordkeeping Requirements
10
U.S. Department of Labor. Handy Reference Guide to the Fair Labor Standards Act
11
Office of the Law Revision Counsel. 29 USC 255 – Statute of Limitations
12
Office of the Law Revision Counsel. 29 USC 216 – Penalties