How to Report Babysitting Income

If you’re wondering how to report babysitting income, you’re not alone—many babysitters, nannies, and even parents are unsure about the tax rules for childcare earnings, especially when payments are made in cash or split among several families. The IRS treats babysitting income as taxable, whether you’re a part-time sitter, a full-time nanny, or just helping out neighbors on weekends. If you earn $400 or more in a year from babysitting, you’re required to report that income, and if you cross the annual threshold of $2,800 from a single family (as of 2025), you may be classified as a household employee, triggering additional payroll tax requirements. For most babysitters, reporting income means keeping good records, adding up total earnings, and filing a tax return—often using Schedule C for self-employment income or “other income” if you’re under the threshold for a 1099 or W-2. Parents who pay babysitters should also be aware of their own obligations, like issuing a W-2 if they pay above the threshold or claiming childcare expenses on their tax return. No matter how you’re paid, it’s important to declare all your babysitting income, deduct any allowable expenses, and stay organized to avoid penalties or IRS headaches down the road.

Who Needs to Report Babysitting Income?

If you earn $400 or more from babysitting in a year, you must report it as self-employment income. This applies whether you’re paid by cash, check, or digital transfer, and even if you work for multiple families. If you earn less than $400, you may not owe self-employment tax, but you’re still required to report the income on your tax return.

What Forms Do Babysitters Use?

• Schedule C (Form 1040): Use this to report your babysitting income and any related expenses (like supplies or transportation).
• Schedule SE: If your net earnings are $400 or more, you’ll also need to pay self-employment tax using this form.
• Form 1040: All income, including babysitting, is ultimately reported on your main tax return.

If you are paid more than $2,800 by one family in a year, you may be considered their household employee. In this case, the family should issue you a W-2, withhold Social Security and Medicare taxes, and handle payroll taxes. If you don’t receive a W-2 but earn above the threshold, you’re still responsible for reporting the income.

How to Track and Report Babysitting Income

• Keep Records: Write down every payment you receive, regardless of amount or payment method.
• Add Up Your Earnings: Total your annual babysitting income from all sources.
• Report All Income: Even if you’re paid in cash or don’t receive a tax form, you must report your earnings.
• Deduct Expenses: If you buy supplies, snacks, or toys for the kids, you may be able to deduct these as business expenses on Schedule C.
• File on Time: Submit your tax return by the IRS deadline to avoid penalties.

What About Parents Who Hire Babysitters?

If you pay a babysitter more than $2,800 in a year, you may be responsible for payroll taxes and should issue a W-2. For smaller amounts, you’re not required to withhold taxes, but you should still keep records for your own tax deductions (like the Child and Dependent Care Credit).

Tips for Babysitters

• Don’t ignore cash payments—they’re taxable too.
• If you work for several families, keep a log for each one.
• Save receipts for any work-related expenses.
• If you’re unsure about your status (employee vs. independent contractor), consult a tax professional.

FAQs

Do I have to pay taxes on babysitting income if I’m paid in cash?
Yes, all babysitting income—including cash payments—must be reported to the IRS if you earn $400 or more in a year.

What tax form do I use to report babysitting income?
Most babysitters use Schedule C (Form 1040) to report income and expenses. If you’re considered a household employee, your employer should give you a W-2.

What happens if I don’t report my babysitting income?
Failing to report income can result in IRS penalties and interest. Always declare your earnings, even if you didn’t receive a tax form.

Can I deduct expenses related to babysitting?
Yes, you can deduct reasonable expenses like supplies, snacks, and transportation when you file Schedule C.