Hiring an Undocumented Nanny

Parent Q&A

  • How to pay an undocumented nanny

    (6 replies)

    We have been interviewing nannies for part-time child care. Most of the individuals we have met are undocumented. If you have chosen to hire an undocumented person how did you pay them: as an employee with appropriate withholding or cash? I know that it is illegal to hire undocumented workers but I’m guessing that it does happen, either with or without knowledge of the person’s immigration status. Please respond to me privately if you don’t feel comfortable posting a reply. 

    You can't do tax withholding for an undocumented worker as they don't have a valid SSN (they might give you one, but it belongs to a different person and that can create a major headache for the true owner of the SSN). So your only option is cash.

    If you want to do the above-table things and do tax withholding, you need to find a nanny that is legally permitted to work in the US. Yes, those nannies do exist.

    If you don't want to pay someone legally then you cannot withhold taxes (they need to have a SSN or taxpayer ID). 

    You either need to pay cash (no records) OR you need to have someone for whom you can report their income to the government and withhold taxes. Some people have a fake SNN which is of course illegal ...

    If you pay someone for whom you don't report income, you are putting both you and the employee at risk - both would be responsible for back taxes. If you are likely to be audited by the IRS then this might be a more important concern. Plus then the employee is not paying disability taxes and is therefore not eligible for those benefits including state paid maternity leave.  Spending cash means it is harder for the government to track where the money goes. But then paying cash means you are providing employment for someone who does not have any other legal access to money ... anyway, this is a complex issue. 

    One other thing to consider: you cannot use your pre-tax dependent care dollars for someone you are paying cash. You need to show your employer a pay stub for the nanny ... and you cannot do that for someone getting paid in cash without records. 

    When we were looking for a nanny we stipulated in the job posting that we would pay over the table and withhold taxes and we found nearly all applicants were then happy to comply with this ... 

    We have done both (paying both "off" and "on" the books). We asked our employee for her preference and followed what she requested. Paying "on the books" can be done using an ITIN (individual taxpayer identification number) in place of a SSN. An ITIN is not (in theory) reported to ICE; there is (in theory) a strong firewall between IRS and ICE. Here is some information about it:

    Paying "on the books" is a lot more work and it will cost more for both you and the employee. (I highly recommend using a service if you can afford it - much less work for you.) However, there are benefits. 1. it gives access to certain government benefits, for example, in case she becomes disabled while on the job. 2, it is the right thing to do (you could still be in trouble with immigration for employing someone who is not authorized to work, but it's not tax evasion, which is a felony). 3, if your nanny is ever in a position to possibly obtain legal status in the US, showing that she has been paying taxes is a big plus for her case and could make them more likely to give her legal status. (I know, it's kind of messed up to expect someone to pay taxes when they weren't supposed to be working, but that's US immigration policy for you.)

    It's important to know that even if you are paying off the books, the person is still your employee (not an independent contractors). Also, ALL labor law applies to workers regardless of their documentation status. So whatever their status, whichever way you are paying, you are still obligated to give overtime pay, minimum wage, etc. Here is some more information about legal responsibilities and best practices:

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March 2002

I am looking for advice on how to bring a nanny over from my home country. The nanny is really my cousin and she would like to be nanny to our child for about a year. I need advice on dealing with immigration. Does anyone know of INS provisions for this sort of situation? Has anyone else done this? Any advice will be greatly appreciated. Edna

I know of two ways of doing this. One is with a tourist visa. Since she is your cousin, she may be able to obtain a 6-month visa, although it's at the discretion of the consulate and lately they have been stingy with those. She would have to go back to her country halfway through her stay and get another visa. Otherwise, she can only stay three month at a time before she needs to go out of the country (further than Canada or Mexico) and get a new one.

The other way is through an au-pair agency, which will cost you around $5000 but includes part of the trip (to NY, which may not save much these days), some orientation, and medical insurance. Then she gets a one-year J1 visa.

It may be possible to get a temporary work visa, but I suspect it would be much harder. Luigi