For a family employing a nanny, housekeeper or carer, Texas is one of the simpler states: there's no state income tax to withhold and the state's own minimum wage law leaves domestic work to federal rules. This post covers what Texas law does require, the federal rules that carry most of the weight, and what doing it yourself involves. Our New York post covers a state with far more rules.
Texas unemployment tax for household employers
Texas Labor Code section 201.027 makes you an employer for state unemployment tax if you paid cash wages of $1,000 or more in a calendar quarter, this year or last, for domestic service in a private home.
- You can choose to report quarterly wages and pay contributions once a year. Make the election by 31 December of the year before the first year you report this way.
- Annual contributions are due by 31 January for wages paid in the previous calendar year.
- This post gives no Texas tax rate or wage base: the Texas Workforce Commission's website couldn't be reached when we checked on 8 October 2026, so confirm your rate with the TWC.
Minimum wage and overtime for a Texas nanny
The Texas Minimum Wage Act adopts the federal minimum wage (section 62.051) but exempts people who do domestic services in or about a private home, babysitting included (section 62.154). Federal law still covers them: the Department of Labor says domestic service workers in private homes are covered by the Fair Labor Standards Act.
| Worker | Minimum wage | Overtime |
|---|---|---|
| Lives out (nanny, housekeeper) | $7.25 an hour | 1.5 times the regular rate for hours over 40 in a workweek |
| Lives in, employed by your household | $7.25 an hour for all hours worked | Exempt from overtime |
| Casual babysitter or companion meeting the duties test | Exempt | Exempt |
Even for a live-in worker, the Department of Labor says you must track and record all hours worked.
How often you must pay
The Texas Payday Law (section 61.011) requires paying non-exempt employees at least twice a month, in pay periods as equal as possible; weekly or every-two-weeks pay meets that. Its definition of employee excludes people related to you or your spouse within the second degree.
Federal household payroll taxes
- Social Security (6.2%) and Medicare (1.45%) from the worker, matched by you, once you pay one household employee $3,000 or more in cash wages in 2026.
- Federal unemployment tax (FUTA) once you pay $1,000 or more in a calendar quarter of 2025 or 2026.
- No federal income tax withholding unless the worker asks and you agree.
- W-2 to the worker and the SSA by 1 February 2027; Schedule H with your 2026 tax return by 15 April 2027.
A worked example
A live-out housekeeper in Austin earns $18 an hour for 30 hours a week: $540 gross. Social Security is $33.48 and Medicare $7.83, so take-home is $498.69, with no state income tax. You owe a matching $41.31, plus FUTA and Texas unemployment tax at your rate. Paid every two weeks, that meets the Payday Law.
States without income tax, and what employers still withhold
A Texas household employer's year, in order
- Get an EIN before you file any employment form; IRS Publication 926 lists it in the household employer checklist.
- Register with the Texas Workforce Commission once cash wages reach $1,000 in a quarter, and decide by 31 December whether to report yearly.
- Each payday, at least twice a month: pay at least $7.25 an hour, add overtime for a live-out worker over 40 hours, withhold Social Security and Medicare once the $3,000 threshold is in sight, and keep the hours record.
- By 31 January: annual Texas unemployment contributions, if you elected annual reporting.
- By 1 February 2027: the 2026 W-2 to the worker and the SSA. By 15 April 2027: Schedule H with your federal return.
Where PayDocs fits
If you run household payroll yourself, PayDocs makes the pay stub for each payday with hours, gross pay, Social Security, Medicare and year-to-date totals, and the W-2 at year end. PayDocs works out federal income tax, Social Security, Medicare and supported state taxes for 2026 pay dates (see what we calculate). You preview free and pay per document, with no subscription.
PayDocs doesn't register you with the Texas Workforce Commission or file anything. This is general information as of 8 October 2026, not tax or legal advice.
Questions
Do I withhold state income tax for a nanny in Texas?
No. Texas has no personal income tax, so there's nothing to withhold for the state. Social Security and Medicare still apply once you pay $3,000 or more in cash wages in 2026.
When does a Texas household employer owe state unemployment tax?
Once you pay $1,000 or more in cash wages for domestic service in a calendar quarter, in the current or previous year. You can elect to report and pay once a year, due by 31 January.
What is the minimum wage for a nanny in Texas?
$7.25 an hour under federal law. The Texas Minimum Wage Act exempts domestic service in a private home, but the federal Fair Labor Standards Act still covers household workers.
Does a live-in nanny in Texas get overtime?
Not under federal law, if your household employs them directly: live-in domestic workers are exempt from overtime but must get the minimum wage for all hours, and you must record those hours.
Sources
- Texas Labor Code, chapter 201, section 201.027 (employer of domestic service worker)
- Texas Labor Code, chapter 62 (Texas Minimum Wage Act), sections 62.051 and 62.154
- Texas Labor Code, chapter 61 (Payday Law), sections 61.001 and 61.011
- Texas Comptroller of Public Accounts, Fiscal Notes: Texas does not have a personal income tax
- US Department of Labor: Fact Sheet #79B, Live-in domestic service workers under the FLSA
- US Department of Labor: Domestic service final rule, frequently asked questions
- IRS: Publication 926 (2026), Household Employer's Tax Guide
Sources checked October 8, 2026. This article explains how pay documents work; it is not tax or legal advice.
