Nanny Mileage Reimbursement in California: What Los Angeles Families Are Required to Pay
In California, reimbursing your nanny for mileage driven in their personal vehicle is not optional, it is a legal requirement. Many LA families either do not know this or underestimate what qualifies. Here is what the law says and how to handle it cleanly.
Quick Answer
In California, reimbursing your nanny for mileage driven in their personal vehicle is not optional, it is a legal requirement. Many LA families either do not know this or underestimate what qualifies. Here is what the law says and how to handle it cleanly.
In California, reimbursing your nanny for mileage driven in their personal vehicle is not optional, it is a legal requirement. Many LA families either do not know this or underestimate what qualifies. Here is what the law says and how to handle it cleanly.
Quick answer: California Labor Code Section 2802 requires employers to reimburse employees for all necessary business expenses, including mileage driven in their personal vehicle while on the job. The current IRS standard rate is $0.70 per mile (2025). This applies to nannies.When does mileage reimbursement apply?
Any time your nanny drives their own vehicle as part of their job duties. Common examples in LA:
- School pickup and drop-off
- Driving children to activities, appointments, or playdates
- Running errands for the family (grocery runs, pharmacy, dry cleaning)
- Driving to a second location for work (e.g., picking up at school, then driving to activities)
Commuting to your home does not count, that is the nanny's personal commute, same as any other employee. But any driving done during the workday in service of the job qualifies.
What is the current reimbursement rate?
The IRS sets a standard mileage rate each year. For 2025, it is $0.70 per mile. This is the rate most families use and the rate California courts look to when assessing disputes.
You can pay more, some families in LA round up or pay a flat weekly stipend for driving-heavy roles. You cannot pay less without risking a wage claim.
What if we provide a car?
If your nanny drives a family-owned or leased vehicle for job duties, mileage reimbursement does not apply, you are already covering the cost. Make sure your auto insurance covers household employees as drivers, which typically requires a policy endorsement or a separate rider.
What if we ask our nanny to use their car but do not want to reimburse?
You cannot. Under California law, requiring an employee to use their personal vehicle for work without reimbursement is an unlawful deduction from wages. If this comes up in a wage claim, you will owe back reimbursements plus potential penalties.
The practical fix: either reimburse at or above the IRS rate, provide a vehicle, or structure the role so driving is not required.
How to track it properly
The simplest approach: ask your nanny to keep a log, date, starting point, destination, purpose, miles driven. A shared Notes document or a free mileage app (MileIQ is popular) works well. Review and reimburse on each pay cycle.
For heavy driving roles, some families build a weekly driving stipend into the compensation package instead. This only works if the stipend adequately covers actual miles at the IRS rate, a flat stipend that falls short of real mileage is still a compliance issue.
Does this apply to all household employees in California?
Yes. California Labor Code 2802 covers all employees, including household workers. The law is broad and employer-friendly enforcement is low, but the liability is real, particularly if a disgruntled former employee files a wage claim.
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Frequently asked questions
How does California overtime work for household employees?
California's Domestic Worker Bill of Rights sets overtime at 1.5x after 9 hours in a single day or after 45 hours in a week. Daily overtime is the rule most families miss. A nanny working 10-hour days Monday through Friday triggers daily overtime every single day.
Do I need to pay payroll taxes for my nanny?
Yes. If you pay a household employee more than $2,700 in a calendar year, you must withhold FICA taxes, pay employer FICA match, and remit federal and California state unemployment insurance. Paying cash does not eliminate this obligation.
What are guaranteed hours for a nanny?
Guaranteed hours mean your nanny is paid for an agreed minimum number of hours per week regardless of whether you use them. If you agree to 40 hours and only need 30 one week, you owe 40 hours of pay. California household employment law treats scheduled hours as wages owed.
Do I pay my nanny if I take a vacation?
If your nanny has guaranteed hours and you are not using them because you are traveling, you generally owe their guaranteed pay. If you negotiate a reduced vacation rate in advance and in writing, that may apply. Unilaterally not paying for weeks you are away is a wage violation.
Can I pay my nanny as an independent contractor?
No. In California, a household employee who works regular hours for one family is an employee, not an independent contractor. Misclassifying them as a contractor to avoid employer obligations creates retroactive tax liability and potential penalties.
Do I pay my nanny during holidays?
California does not legally require holiday pay, but paying for major holidays is standard in Los Angeles. Most work agreements list specific paid holidays. If your nanny works on a holiday, they should receive their regular pay plus any applicable overtime.
What are the real costs of hiring a nanny in Los Angeles?
Beyond hourly pay, expect: employer payroll taxes (roughly 10 to 12% of gross wages), paid sick leave (required by California law), 10 days paid vacation (competitive standard), and potentially a health contribution. Placement agency fees are typically 20% of first-year gross salary.
Is it illegal to pay a nanny under the table in Los Angeles?
Yes. Nannies are household employees under California and federal law. Paying off the books exposes families to back taxes, penalties, and potential liability. It also leaves the nanny without workers compensation, unemployment protection, or Social Security credits.
How does California nanny overtime work?
California law entitles most nannies to overtime after 9 hours in a day or 45 hours in a week, and double time after 12 hours in a day. Personal attendant rules apply differently - families should confirm with a payroll specialist how their specific arrangement is classified.
Can I pay a nanny in cash in California?
Cash is a payment method, not a classification. You can pay in cash but must still report wages, withhold appropriate taxes, and issue a W-2. Paying cash without tax reporting is what is illegal, not cash itself.
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