The 10 Best Nanny Payroll Services of 2020

Becoming a household employer means a lot more than finding the perfect nanny, in-home caregiver, or housekeeper. It also means learning how to pay payroll taxes, offer benefits, and file new-hire paperwork with your state. Luckily, nanny payroll services come in all shapes and sizes, not to mention a variety of price points. Business.org reviews the year’s best nanny payroll companies.
Best overall Nanny Payroll
SurePayroll
SurePayroll
  • Icon Pros  Dark
    Affordable plans starting at $19.99/mo.
  • Icon Pros  Dark
    Easy-to-use mobile app
  • Icon Cons  Dark
    Extra charge for accounting software integration
Best outsourced
NannyChex
NannyChex
  • Icon Pros  Dark
    Fully outsourced payroll
  • Icon Pros  Dark
    Employer Identification Number setup included
  • Icon Cons  Dark
    More expensive than some competitors
Best for 2+ employees
Savvy Nanny
Savvy Nanny Payroll Services
  • Icon Pros  Dark
    Flat-rate plans at $40.00/mo.
  • Icon Pros  Dark
    Plans pay up to 2 employees
  • Icon Cons  Dark
    Expensive fees for payroll changes
Simplest setup
Wave
Wave Payroll
  • Icon Pros  Dark
    Affordable self-service and full-service plans
  • Icon Pros  Dark
    Employee portal for tax document access
  • Icon Cons  Dark
    Fewer nanny-specific services
Best benefit add-ons
GTM Payroll Services
GTM Payroll Services
  • Icon Pros  Dark
    Super-responsive live chat
  • Icon Pros  Dark
    Wide-ranging benefits options
  • Icon Cons  Dark
    Pricier than software options

The hardest part of hiring a nanny is finding the perfect candidate—or so you thought when you started looking. But now that you’ve located your real-life Mary Poppins, the actual hardest part of hiring a household employee starts to set in: paying their taxes.

But before you can think about nanny tax services, you have to get a federal Employer Identification Number (EIN) so you can pay their taxes. You have to fill out the right documents to report the new hire to your state government. Based on where you live, you might need workers compensation insurance. And at the end of the fiscal year, you need to file all tax paperwork to the IRS and distribute the right forms to your household employees so they can track their taxes too.

Remember when you thought hiring a nanny was going to simplify your life? Ah, the good old days.

Here’s the upside, though: it’s not hard to find a household payroll service that handles just about every aspect of paying your nanny (or your gardener, babysitter, nurse, or house cleaner). Read on to see our favorite nanny payroll services for household employers.

Best nanny payroll services of 2020

Ranking factors
Info

Here’s the criteria we used to find our top nanny payroll picks:

  • Pricing, including year-end tax filing fees, registration fees, and monthly or quarterly costs
  • Customer service, including live chat options, hours of availability, email response times, customer service ratings, and Better Business Bureau complaints
  • Hands-off automation, including options for automated payroll tax filing, end-of-year taxes, and payroll runs
  • User-friendliness, including website accessibility, ease of use, mobile apps, and employee access portals
  • Additional perks, including workers compensation and 401(k) options
  • Tax services, including year-end tax filing guarantees, audit assistance, and tax filing help

Best nanny payroll pricing

Brand
Starting base cost
Tax filing fees
Standout services
Learn more
SurePayroll$19.99/mo.UnlistedTax filing guarantees, new hire reporting, mobile app
NannyChex$6.25 per weekly paycheck or $12.50 per bi-weekly paycheck$80.00/quarter + $150.00 for year-end tax prepComprehensive nanny payroll services, dedicated account representative
Savvy Nanny$40.00/mo.$50.00 for year-end tax prepNo quarterly tax filing fee, up to 2 employees per plan
Wave Payroll$20.00/mo. + $6.00/employeeUnlistedEmployee self-service portal, automatic payroll reminders
GTM Payroll Services$65.00/mo.$100.00 (optional year-end tax prep service)Optional benefit add-ons, on-time tax filing guarantee

Data effective 10/6/20. At publishing time, pricing and features are current but are subject to change. Offers may not be available in all areas.

SurePayroll: Best overall

SurePayroll

With its super affordable monthly price, complete automation, and easy mobile access, SurePayroll is a prime choice for household employers who want payroll help at a low cost.

If you want a low-hassle solution at a low monthly price, SurePayroll is it. The company offers two payroll plans for household employers: a $19.99 self-service plan where you file employee taxes yourself, and a $29.99 full-service plan where SurePayroll files taxes for you.

Although the $29.99 plan definitely comes with a little less hassle, the $19.99 plan is nothing to sneeze at. Sure, you’ll need to file taxes yourself, but the software helps you calculate the right amount to withhold and simplifies the e-filing process by providing you with the right forms and documents.

And both SurePayroll plans include a tax filing guarantee: SurePayroll promises that the taxes it helps you calculate (or the taxes it files for you) are accurate. If they aren’t, SurePayroll deals with the IRS and pays all associated fines and fees.

Regardless of the plan you pick, you get these SurePayroll perks:

  • New hire state reporting
  • Automatic payroll payments and direct deposit
  • Employer-facing mobile app (for paying nannies on the go)
  • Solid US-based customer service support, including evenings and weekends

SurePayroll definitely has a few drawbacks—for one, its affordable price means it’s less comprehensive than providers who also offer employee benefits and workers compensation insurance. But if you’re paying a nanny just a few hours a day or week, you really don't need all the bells and whistles, and SurePayroll's simplicity and affordability should hit the spot.

Any downsides? SurePayroll doesn’t have an email option for customer service—you have to call in for help. The website isn’t the most thorough source of information either. Unless you enter your name and email address to get a quote (which is what we did), you can’t see the nanny payroll pricing and features.

Strengths
Pro Bullet Super affordable starting price ($19.99/mo.)
Pro Bullet Tax calculation and filing guarantee
Pro Bullet Automatic payroll runs
Weaknesses
Con Bullet Four-day payroll processing with cheapest plan
Con Bullet Additional monthly fee for accounting software integration

NannyChex: Best outsourced service

NannyChex

As a fully outsourced payroll service, NannyChex handles payroll taxes, sick time and vacation tracking, Employer Identification Number setup, and tax agency correspondence. Just enter some basic employee and pay rate info; after that, you’re good to go.

Along with payroll tax calculation and filing, NannyChex offers a host of services for household employers who want a totally hands-off nanny payroll experience:

  • New hire reporting
  • Employer Identification Number setup
  • Sick time, vacation time, and paid time off (PTO) tracking

Each NannyChex customer also gets a dedicated account specialist who knows your situation inside and out. They can answer any questions not just about taxes but about your taxes in particular.

NannyChex offers two payroll plans: a tax-only plan or a full-service plan. With the tax-only plan, NannyChex takes care of everything for you except directly paying your nanny—you'll write the check yourself. Full-service takes care of direct deposit, though you'll pay a fee for each paycheck deposited: $6.25 for weekly paychecks and $12.50 for bi-monthly or monthly paychecks.

Since NannyChex handles every aspect of household employment, it costs a little more than pay-per-month software like SurePayroll. With the tax-only plan, you'll pay $125 for quarterly tax filing and $195 for year-end tax prep, which brings your total to $695 per year. The full-service plan charges less in tax filing fees ($80 per quarter plus $150 for year-end tax filing), but since you're paying for each deposited check, the yearly total is closer to $795. (In contrast, SurePayroll’s self-service plan totals about $240 a year.)

Strengths
Pro Bullet Comprehensive nanny payroll services
Pro Bullet Dedicated account specialist
Weaknesses
Con Bullet Pricier than self-service software options

Savvy Nanny: Best for 2+ employees

Savvy Nanny

Savvy Nanny's flat rate of $40.00 a month lets you pay two employees. With a $50.00 end-of-year tax filing fee, its plan is one of the most affordable choices out there.

If you're paying two household employees to watch your kids, Savvy Nanny should be at the top of your list. Its $40-a-month plan lets you pay two employees and doesn't charge you extra for each paycheck deposited: the flat rate you see is exactly what you get. And if you have more than two employees, Savvy Nanny has your back there too. Each additional employee costs $6 extra per month and $5 extra at the end of the year.

Savvy Nanny also keeps things affordable by charging a one-time year-end tax filing fee of just $50. Compare that to NannyChex’s $80 fee per quarter and $150 fee for year-end filing and you can see why Savvy Nanny stands out. While you have to email or call to sign up, subscribers can access live chat, phone, and email support six days a week.

While Savvy Nanny looks cost-effective on paper, the service charges a series of fees that can add up if you're not careful. For instance, if you don't have sufficient funds to cover a payroll run, you're charged $150 for a first offense, $250 for a second, and $400 for a third. You’ll also pay $150 if you want to access tax documents that are more than two years old, or $100 to request changes after Savvy Nanny deposits your nanny's first paycheck.

Strengths
Pro Bullet Affordable plan with $50 year-end filing fee
Pro Bullet Plans for paying up to two employees, plus a low fee for additional employees
Weaknesses
Con Bullet Additional fees for document requests, payroll changes, and more
Con Bullet Fewer services than competitors
Tired of payroll? Gusto handles payroll taxes and more

With unlimited payroll runs and automatic tax filing, Gusto helps small-business owners worry less about payroll and put more time into growing their business.

  • Get automatic payroll tax filing, including end-of-year tax forms
  • Manage workers compensation insurance
  • Track paid time off, sick leave, and holiday pay

Wave Payroll: Simplest setup

Wave

In 36 states, Wave Payroll can’t file taxes for you, but it can calculate payroll taxes and directly deposit paychecks into your employees’ accounts for $20 a month. In the other 14 states, Wave Payroll files your payroll taxes for just $15 more than its already unbeatable price.

For affordability and service, Wave rivals SurePayroll. Starting at $20 a month, it tackles some of the most important aspects of nanny payroll:

  • Automatic payroll tax calculation
  • Guaranteed payroll tax accuracy
  • Direct deposit or check printing
  • Employee self-service portal (access to W-2s and pay stubs)
  • Automatic payroll reminders
  • Workers compensation add-ons

In most states, Wave Payroll is self-service—you don't have the option to upgrade to a full-service plan. On the other hand, household employers in the remaining 14 states must choose Wave's full-service plan, which starts at $35 a month.

Unlike NannyChex and Savvy Nanny, Wave Payroll wasn't created specifically to tackle household payments. Instead, Wave focuses on the freelancers and small-business owners who use its free accounting software. So while Wave Payroll can simplify your payroll process, it doesn't have nanny-specific add-ons like EIN setup.

Strengths
Pro Bullet Easy setup with low software learning curve
Pro Bullet Affordable self-service and full-service plans
Weaknesses
Con Bullet Fewer nanny-specific features

GTM Payroll Services: Best benefits add-ons

GTM Payroll Services

GTM Payroll Services charges more per month than many competitors, but with its great customer service and comprehensive benefits plans, it’s a good fit for household employers who want competitive benefits and anytime assistance.

GTM Payroll Services calculates payroll taxes, files them on your behalf, and automates payroll so your employees always get paid on time—pretty standard features for a nanny payroll service. But it stands out from the other providers on our list in one crucial area: benefit add-ons.

Depending on your state, you can use GTM Payroll Services to offer competitive benefits like the following:

  • Workers compensation insurance
  • Employee health benefits (including medical, vision, and dental insurance plans)
  • 401(k) options
  • Travel insurance
  • Employee background checks

These services each cost extra, which makes GTM’s hefty $65 per month plan even heftier. The high pricing also gives you a few benefits, most notably stellar customer service. GTM Payroll Services’ live chat is super responsive, which is great news for parents who need quick answers to their payroll questions. You can save a little cash by preparing and filing your own end-of-year tax forms, or you can choose GTM’s optional $100 year-end tax prep service.

GTM is also the only one of our top picks to offer a household employer–specific guide to employing a nanny during COVID-19. Whether you choose GTM or not, we recommend checking out the guide: it has great advice that can help protect you, your kids, and your nanny.

Strengths
Pro Bullet Comprehensive, competitive benefit add-ons
Pro Bullet Stand-out customer service
Weaknesses
Con Bullet More expensive than competitors, especially nanny payroll software

Honorable mentions

If our top picks above don’t meet your needs, don’t worry; there are plenty more where those came from. Here are five more picks we think are worth your while.

Poppins Payroll: Most user-friendly

Poppins Payroll

Although its service is currently limited to just a few states, Poppins Payroll is a powerful up-and-comer with low prices, extensive bookkeeping, and ultimate user-friendliness.

If you were hoping at least one nanny payroll service out there locked down a Mary Poppins reference, Poppins Payroll is absolutely here for you. At $39 a month, Poppins Payroll will take on just about every payroll task you need, from Employer Identification Number registration to new-hire paperwork filing. The service files taxes for you, stores records, and even helps with bookkeeping. Most notably, it doesn't charge extra for quarterly or year-end tax filing.

Unfortunately, Poppins Payroll is available in only 11 states and the District of Columbia. We hope Poppins Payroll expands soon—the other 39 states could definitely benefit from its stellar service, adorable website, and super low cost.

HomeWork Solutions: Best dedicated assistance

Homework Solutions

Like NannyChex, HomeWork Solutions gives you access to a dedicated account representative who knows your household employment situation inside and out. As the highest priced option on our list, though, it's cost prohibitive for many household employers.

HomeWork Solutions’ full-service plan includes a dedicated account representative, comprehensive tax filing services, tax document storage, and employee pay stub access. But at $225 a quarter ($900 for the year), HomeWork Solutions is on the pricier end of the nanny payroll spectrum. The streamlined Essential Payroll plan costs a more affordable $150 a quarter, but it cuts out some key benefits that providers like SurePayroll include for less, like document storage and paystub access.

NannyPay: Best DIY software

Logo for NannyPay

If you’d rather tackle payroll (mostly) on your own, NannyPay’s software gives you all the tools you need to calculate and file your nanny’s taxes yourself.

NannyPay is a downloadable payroll software program that starts at just under $150 per year. There are a few trade-offs for the price: NannyPay doesn’t manage direct deposit on your behalf, and you have to file all taxes yourself. But if you want accurate calculations and easy-to-generate, signature-ready tax forms, NannyPay has you covered.

HomePay: Best HR support

Homepay

Want to stay on top of legal compliance? HomePay’s HR assistance keeps you up to date on all legal requirements for employing and paying a nanny, but the help comes at a fairly steep cost.

Care.com’s HomePay might be the most comprehensive payroll solution on our list. Along with calculating and filing taxes, the company offers HR assistance that keeps you in compliance with nanny payroll laws. Its budgeting feature makes it easy to figure out what you can afford nanny-wise while maximizing your tax return benefits, and its resource guides can help you decide what to pay your nanny and what benefits to offer.

However, HomePay is definitely pricier than most options, though we can’t say definitively how much it costs—you’ll have to call HomePay directly to request a customized quote. In the past, HomePay cost upwards of $1,000 a year, and we’re guessing the company hasn’t made any dramatic price cuts over the last year.

Simple Nanny Payroll: Best calculator-only

Simple Nanny

If you don’t want to pay for anything more than streamlined payroll tax calculations, Simple Nanny Payroll’s $29-a-year calculator should suit you nicely.

Simple Nanny Payroll isn’t a full-service payroll option. Instead, it’s a DIY service that lets you calculate nanny payroll taxes and reach out to customer service for tax resources if you run into trouble. The payroll calculator is pretty handy, and the service costs only $29 for a full year. Simple Nanny Payroll isn’t too fancy, but it’s definitely a step above a spreadsheet. If you’re on a pretty limited budget and want to make sure you’re calculating taxes correctly, it’s a solid choice.

Nanny payroll service FAQ

What is the nanny tax?

The nanny tax is an umbrella term for the taxes you must withhold from your nanny’s paycheck and the employee tax contributions you need to match:

  • FICA taxes, or the Social Security and Medicare taxes that both you and your employee pay
  • FUTA taxes, or the federal unemployment insurance tax that only you pay, not your employee

For the 2020 tax season, the Social Security tax is 6.2% of each paycheck and the Medicare tax is 1.45% of each paycheck. If you pay your employee $2,200 or more per year, you’re required to withhold that amount from your employees’ wages to file with the federal government. You’ll also need to match your employees’ contribution out of your own pocket.

In contrast, only employers pay FUTA taxes. Luckily, the tax itself isn’t too expensive: the FUTA tax rate is just 6% of an employee’s first $7,000 of wages. In other words, employers never pay more than $420 in FUTA taxes per employee. You’ll only pay the tax if your employee makes more than $1,000 per quarter.

The IRS lists some exceptions to nanny taxes, so before you start filing taxes, you might want to give their list a read-through.

Do I need an EIN to pay my nanny?

Yes, you need an Employer Identification Number (EIN) to pay your nanny. To get an EIN, apply for one from the IRS—the application doesn’t cost anything and is fairly painless. Plus, if you apply online (the IRS’s preferred method, though you can also apply via mail or fax), you get your EIN immediately, which means your nanny will be able to start working for you right away.

What is the best nanny payroll service?

SurePayroll is our favorite nanny payroll service. Both its self-service and full-service payroll plans make tax filing simple, and as one of the only payroll providers with a solid mobile app, SurePayroll is both flexible and versatile. Best of all, SurePayroll starts at $19.99 a month—a practically unbeatable price.

However, the best nanny payroll service for you depends largely on what you need. Do you want to provide comprehensive benefits to your household employee? GTM Payroll Services might be a better fit for you than SurePayroll. Are you comfortable handling most aspects of nanny payroll yourself? Simple Nanny Payroll could be the bare-bones solution you’re looking for.

Can I pay my nanny through my small business?

No, you cannot pay your nanny through your small business. If you’re going to pay a household employee, the federal government requires you to obtain a new Employer Identification Number. Making small-business tax deductions based on a household employee’s salary is against the law and can result in hefty fines—it’s not worth the risk.

What are the best and worst states for working parents?

While hiring a nanny can certainly be a big help, most working parents still want to maximize the amount of time they’re able to spend with their kids.

To do that, you need a positive combination of circumstances: family-friendly legislation that allows you to take time off when you need it and an income that can actually cover the cost of your housing. In this time of pandemic, it’s also really important to find an area with a stable job market with a low unemployment rate.

A lot of those factors depend heavily on where you live, so we took a look at the data to find out which states offer the best (and worst) environments for working parents.

Key Findings

  • The District of Columbia is the most working parent–friendly area in the nation. D.C. offers all the job protections and family leave available in the U.S., meaning parents can usually take advantage of paid leave for medical reasons, maternity time, and paternity time. D.C. also has the lowest rent-to-income ratio in the country, meaning parents (theoretically) don’t have to spend as much time working in order to cover their housing costs—though we should note that this number may be skewed since most of the people making high incomes in the D.C. area don’t actually live in the low-cost neighborhoods within the District of Columbia.
  • Nevada is ranked last for working parents. In addition to having a high cost of living and high unemployment rates, Nevada also doesn’t offer any legal benefits for parents other than the basic FMLA requirements.
  • All three west coast states made it into the top 20 states for working parents. California and Washington both grant full legal protections for parents, while Oregon has a solid income-to-rent ratio and low unemployment.

The rankings

Rank
State
Rent as a percentage of household income
2019-2020 unemployment rate change
Paid family leave
Paid medical leave
Job-protected leave
1District of Columbia27.1%+3.4%Icon Checked Box  DarkIcon Checked Box  DarkIcon Checked Box  Dark
2Washington29%+3.7%Icon Checked Box  DarkIcon Checked Box  DarkIcon Checked Box  Dark
3New Jersey 29.6%+3.1%Icon Checked Box  DarkIcon Checked Box  DarkIcon Checked Box  Dark
4Iowa26.5%+1.9%Icon Cons  DarkIcon Cons  DarkIcon Checked Box  Dark
5New York 30.1%+5.8%Icon Checked Box  DarkIcon Checked Box  DarkIcon Checked Box  Dark
6Massachusetts29.5%+6.8%Icon Checked Box  DarkIcon Checked Box  DarkIcon Checked Box  Dark
7Rhode Island 29.5%+7%Icon Checked Box  DarkIcon Checked Box  DarkIcon Checked Box  Dark
8Montana27.9%+1.8%Icon Cons  DarkIcon Cons  DarkIcon Checked Box  Dark
9Minnesota27.6%+2.8%Icon Cons  DarkIcon Cons  DarkIcon Checked Box  Dark
10Maine28.1%+3.2%Icon Cons  DarkIcon Cons  DarkIcon Checked Box  Dark
11California31.7%+7.1%Icon Checked Box  DarkIcon Checked Box  DarkIcon Checked Box  Dark
12Wisconsin26.8%+2.0%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
13New Hampshire28.9%+3.4%Icon Cons  DarkIcon Cons  DarkIcon Checked Box  Dark
14North Dakota24.1%+2.0%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
15South Dakota25.2%+0.7%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
16Nebraska26.3%+0.5%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
17Connecticut29.6%+4.1%Icon Cons  DarkIcon Cons  DarkIcon Checked Box  Dark
18Oregon29.4%+4.5%Icon Cons  DarkIcon Cons  DarkIcon Checked Box  Dark
19Louisiana31.2%+3.0%Icon Cons  DarkIcon Cons  DarkIcon Checked Box  Dark
20Kentucky 27%+1.3%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
21Alaska27.6%+1.0%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
22Kansas26.4%+2.8%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
23Missouri27.5+1.6%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
24Oklahoma27.2%+2.0%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
25Wyoming27.3%+2.4%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
26Utah27.7%+2.5%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
27Maryland29.9%+3.7%Icon Cons  DarkIcon Cons  DarkIcon Checked Box  Dark
28Arkansas27.2%+3.7%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
29Arizona28.6%+2.1%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
30Mississippi29.2%+1.5%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
31Indiana28.1%+3.0%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
32Vermont32%+1.8%Icon Cons  DarkIcon Cons  DarkIcon Checked Box  Dark
33Idaho28%+3.2%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
34Ohio27.2%+4.3%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
35Tennessee28.5%+3.0%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
36West Virginia28.2%+3.6%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
37Virginia28.3%+3.5%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
38South Carolina29%+2.7%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
39North Carolina28.4%+3.6%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
40Pennsylvania28.6%+3.5%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
41Alabama28.7%+3.9%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
42Georgia 29.3%+3.2%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
43New Mexico28.4%+4.6%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
44Hawaii32%+12.4%Icon Cons  DarkIcon Checked Box  DarkIcon Checked Box  Dark
45Michigan 29%+4.6%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
46Texas29.2%+4.8%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
47Colorado 30%+3.8%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
48Delaware29.7%+4.3%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
49Illinois28.1%+6.5%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
50Florida33.1%+4.7%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark
51Nevada30.5%+8.9%Icon Cons  DarkIcon Cons  DarkIcon Cons  Dark

Our methodology

To find out which states were best for working parents, we used data that might indicate parents in the area had more free time to spend with their children. Specifically, we looked for states that offered family-friendly legal protections, including paid family leave (paid maternity and paternity leave), paid medical leave, and various types of job-protected leave.

We also wanted to know which states offered the best ratio of income to housing costs (according to the U.S. Census Bureau), since a parent with a high income-to-rent ratio might not have to work as many hours to cover their family’s basic needs. We also looked at job stability during the coronavirus pandemic by examining the state’s change in unemployment rate over the past year (according to the Bureau of Labor Statistics).

We then weighted those numbers to prioritize the most important factors, using the most recent data available:'

  • Gross rent as a percentage of household income (2019): 30%
  • Unemployment rate change (Sept. 2019–Sept. 2020): 30%
  • Paid family leave: 10%
  • Paid medical leave: 10%
  • Job-protected leave (lower employer size threshold): 10%
  • Job-protected leave (lower employee tenure/hours worked requirement): 10%

We also wanted to note that since lower income-to-rent ratios and unemployment rates are preferable, states with the lowest numbers in these categories were scored higher.

The takeaway

The less parents have to worry about child care, paid time off, job security, and basic housing needs, the more precious time parents can spend with their children.

This is made even easier with tools like nanny payroll services, which can make household hiring decisions a lot easier. Plus, if you don’t have to worry about taxes on your nanny payroll, you can focus on your employee’s work, benefits, and happiness—and on enjoying the tax-free time payroll software opens up for you.

Looking for bookkeeping software that makes running household finances a little easier? Our top bookkeeping software picks for small businesses could work for you too.

Disclaimer

At Business.org, our research is meant to offer general product and service recommendations. We don't guarantee that our suggestions will work best for each individual or business, so consider your unique needs when choosing products and services.

Kylie McQuarrie
Written by
Kylie McQuarrie
Kylie spent two of the last four years writing for and with small-business owners—from dentists in Australia to plumbers in the Midwest. She spent the other two writing in depth about internet and security. She’s passionate about reading, hiking, and dedicating every spare second to writing for fun (at lunch, between meetings, on the train, before breakfast . . . ). Her content helps small-business owners tackle the logistics of running a business so they can focus more on their passions too.
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