Now-a-days, many parents are avoiding paying nanny tax. It is reduced to 10 percent of house hold employment tax filings for nannies and other domestic workers in 2006, according to latest internal Revenue Service date. According to Labor Department, the number of domestic employees increased, but taxes were reduced. Tax filings were reduced down to 26 percent to 2,25,441 within 10 years, from 1996 to 2006. Parents are searching for nanny through the web and there is increase in online hiring, and adverse cost attitude of parents.

Actually, avoiding taxes is not a wise thing, but some trends pose some risks now. Many nannies are filing for unemployment benefits, when many of them laid off because of slumping economy. Then tax regulators watch continuously those tax regulators. If nannies avoid the taxes they will lose the safety net like medicare and social security benefits.

If people pay more than $1600 for house hold employees then they have to file paperwork and they have to pay 7.65% on gross pay to cover some social security and medicare taxes. To get federal unemployment insurance then they have to pay 0.8 percent of gross salary. To get state unemployment insurance they have to pay 2 to 4 percent of salary as a tax.

Hiring nannies online increased to 30 to 50 percent from about five years ago.

Only few parents are thinking to provide benefits to any kind of nannies like part time and full time nannies by paying taxes.