If nanny payroll has a final boss, it's Schedule H. The name sounds official and a little scary, but it's simply the form where your year of household employment taxes gets totaled and paid. Here's the whole idea.

What Schedule H does

Schedule H (Household Employment Taxes) reports the taxes you owe as a household employer for the year: the Social Security and Medicare taxes (both the employee share you withheld and your employer share) and the federal unemployment tax (FUTA). If you also withheld federal income tax from your nanny, that's reported here too.

Unlike a business, a household employer usually doesn't file separate quarterly payroll returns. Instead, everything is reconciled once a year on Schedule H, attached to your personal return.

It rides with your personal 1040

This is the part that surprises people: Schedule H isn't a standalone filing. You attach it to your own Form 1040. The household employment taxes are added to your personal tax bill for the year, and you settle them when you file.

Avoiding the April surprise

Because these taxes land on your 1040, they can add up to a meaningful amount owed at filing time if you haven't planned for it. Two clean ways to avoid the shock:

  • Make quarterly estimated payments (Form 1040-ES) that include your expected household employment taxes.
  • Increase withholding at your own job so your personal withholding covers the extra liability.
The simplest habit: each pay period, move your employer taxes plus what you withheld into a separate savings bucket. When Schedule H time comes, the money is already there.

House tracks what to set aside every quarter and assembles your Schedule H figures from the payroll you've run — so nothing is a surprise.

Track my quarterly taxes

The bottom line

Schedule H is just the annual reconciliation of your household payroll, filed with your 1040. Keep accurate pay records through the year and set money aside as you go, and filling it out becomes a matter of copying totals you already have.