Connecticut Household Employer Guide 2026
Your household employee — a nanny, caregiver, housekeeper, or anyone who works in your Connecticut home — is a W-2 employee. Connecticut is a higher-compliance household-payroll state: state income tax withholding from day one, CT Paid Leave contributions, CT unemployment filings, workers' comp at 26+ hours per week, and paid sick leave expanding to all employers in 2027.
Start Payroll Free →When the rules apply
Connecticut household employers mainly need to watch federal payroll thresholds, Connecticut's first-dollar state withholding/UI rules, and CT Paid Leave contributions.
How Nest Payroll handles this
Each pay period, you pay your employee the net amount directly — through Venmo, Cash App, Zelle, your banking app, or by check. Nest generates the pay stub, calculates federal payroll taxes, Connecticut withholding, and the CT Paid Leave deduction.
Federal taxes — quarterly EFTPS payments
At the end of each federal quarter, Nest debits your bank account for federal taxes owed and remits them to the IRS via EFTPS. At year-end, Schedule H on your Form 1040 reconciles those household payroll taxes.
Connecticut state taxes — CT-941, UC-2/UC-5A, and PFML
Nest supports Connecticut withholding returns, CT unemployment filings, and CT Paid Leave contribution remittance. CT PFML is employee-funded at 0.5% of wages up to the Social Security wage base.
Set up payroll in 5 minutes.
Nest handles Connecticut payroll calculations, paystubs, CT-941 withholding, UC-2/UC-5A unemployment filings, CT Paid Leave contributions, and year-end Schedule H.
Start Payroll Free →Setup checklist (before they start)
Connecticut Workers' Compensation Insurance
Connecticut requires workers' compensation for household employees who work 26 or more hours per week. If your nanny, caregiver, or housekeeper works fewer than 26 hours per week, coverage is not legally required, but voluntary coverage is still worth considering.
Form I-9 (Employment Eligibility)
Have your employee complete the Form I-9 at hire to verify they're authorized to work in the United States. You don't submit this anywhere — keep it filed in case of audit.
Federal W-4 + Form CT-W4
The federal W-4 determines federal income tax withholding if you and your employee agree to withhold it. Connecticut uses Form CT-W4 for state withholding. Unlike federal income tax withholding, Connecticut state income tax withholding is required from the first paycheck.
Federal income tax withholding is voluntary for household employers — it requires mutual agreement between you and your employee. Connecticut state income tax withholding, however, is required regardless.
Connecticut New Hire Reporting
Connecticut requires all employers to report newly hired and rehired employees to the Connecticut New Hires Reporting Center (administered by CT DOL) within 20 days of the hire date.
You'll provide your employee's name, address, SSN, hire date, and your contact information.
Required Employment Posters
Connecticut requires several employment posters in the workplace. For a household, "the workplace" is your home — but you should still keep a binder with the required notices and confirm with your employee that they've reviewed them. Required posters include:
- Connecticut Minimum Wage poster (CT DOL)
- Connecticut Paid Sick Leave notice (CT DOL — required for covered employers)
- CT Paid Family and Medical Leave notice (CT Paid Leave Authority — required for ALL employers)
- Connecticut Workers' Compensation notice
- Federal "EEO is the Law" + FLSA Min Wage posters
Written Work Agreement
Connecticut does not require a written work agreement for household employment, but having one in writing protects everyone. A good agreement covers: pay rate, hours, schedule, duties, paid time off, holiday pay, sick leave accrual, mileage reimbursement policy, termination process, and confidentiality. Use Nest's free Nanny Contract Template to get started.
Pay & compensation
Minimum Wage — $16.94/hr (Jan 1, 2026, ECI-indexed)
Connecticut's minimum wage is $16.94 per hour as of January 1, 2026, up from $16.35 in 2025 (a 3.6% adjustment based on the Employment Cost Index for the 12 months ending June 30, 2025, per PA 19-4). Minimum wage adjusts annually each January 1 based on the previous year's ECI. Connecticut has no separate tipped wage rate that significantly differs from the standard minimum for household employees.
Overtime — 1.5× regular pay over 40hr/week
| Worker type | Overtime rule | Source |
|---|---|---|
| Live-out (works at your home but doesn't reside there) | 1.5× regular rate over 40 hours per week | FLSA + C.G.S. § 31-76b |
| Live-in (resides at your home) | Exempt from FLSA overtime; no Connecticut state rule extending overtime to live-in domestic workers | 29 USC § 213(b)(21) |
"No Tax on Overtime" Deduction (2025–2028)
The federal overtime deduction may let household employees deduct the premium portion of qualifying overtime pay on their personal tax return. This is a federal income-tax rule; it does not change how you calculate overtime, FICA, Connecticut withholding, CT PFML, or payroll records.
Pay Frequency
Household employees are usually treated as non-exempt hourly workers under FLSA rules — even when you've agreed to pay a "salary," federal FLSA treats it as a wage covering a fixed number of hours per week, with overtime owed on hours past 40.
Under C.G.S. § 31-71b, Connecticut employers must pay wages at least weekly by default; biweekly is permitted with CT DOL approval (most household employers qualify). Most household payroll arrangements pay weekly or biweekly to keep cash flow predictable for both sides.
Mileage Reimbursement
Connecticut does not require employers to reimburse mileage at the IRS standard rate, but if you ask your employee to use their personal vehicle for work-related driving (e.g., kid pickups, errands), you should reimburse them. The 2026 IRS standard mileage rate is 70 cents/mile for business use. Reimbursement at the IRS rate is non-taxable income for the employee.
Paystub Requirements
Under C.G.S. § 31-13a, Connecticut employers must provide an itemized wage statement with each paycheck showing: employer name, employee name, hours worked, hourly rate, gross wages, all deductions (federal income tax, FICA, CT state income tax, CT PFML 0.5%), net pay, and pay period dates.
Time off & leave
Connecticut Paid Sick Leave
Connecticut paid sick leave expanded on January 1, 2026 to employers with 11 or more employees. On January 1, 2027, it expands again to employers with 1 or more employees, which will include most household employers.
When covered, sick leave accrues at 1 hour per 30 hours worked. For household employers, frontloading the annual amount is usually simpler than tracking accrual every pay period.
Connecticut Paid Family and Medical Leave (PFML)
Connecticut Paid Leave applies to every Connecticut employer with 1 or more employees, including households. Employees contribute 0.5% of wages up to the Social Security wage base. The program is fully employee-funded; there is no employer match.
Vacation & PTO
Connecticut does not require paid vacation. If you offer it, your written policy controls whether unused vacation accrues, carries over, or is paid out at separation.
Upon departure
Connecticut final pay timing depends on how the relationship ends. If the employee resigns, final wages are due by the next regular payday. If you terminate the employee, final wages are due by the next business day. Pay out unused vacation only if your written policy provides for payout.
Year-end forms
Your responsibilities
- Hand the W-2 to your household employee by January 31 — Nest produces this; you deliver it
- Attach Schedule H to your Form 1040 by April 15 — Nest produces a signature-ready version
What Nest handles for you
- Quarterly federal tax payments to the IRS via EFTPS
- W-3 + Copy A of W-2 filed with the Social Security Administration
- Quarterly CT-941 filings through myconneCT
- Quarterly UC-2/UC-5A filings through the CT DOL portal
- Quarterly CT PFML contributions through the CT Paid Leave Authority portal
- Annual CT-W3 reconciliation and W-2 state copy
Tax breaks for household employers
Three federal tax provisions can offset the cost of household employment:
- Child and Dependent Care Tax Credit (CDCTC) — Up to 35% of $3,000 (one qualifying child) or $6,000 (two or more) in care expenses on Form 2441 with Form 1040.
- Dependent Care FSA (DCFSA) — If your employer offers one, you can set aside up to $5,000 per year (single or married filing jointly) of pre-tax salary to pay for care. The OBBBA increased this to $7,500 starting 2026.
- Connecticut state credit — Connecticut offers a child and dependent care expense credit on Form CT-1040 Schedule 3, mirroring the federal CDCTC at a percentage of the federal credit.
Resources & free tools
The information on this page is general in nature and not tax, legal, or financial advice. Connecticut rules change. Verify current rates and rules with CT DRS, CT DOL, CT Paid Leave Authority, and the CT Workers' Compensation Commission, or consult a tax advisor.