Missouri Employer Guide

Missouri Household Employer Guide 2026

Your household employee — a nanny, caregiver, housekeeper, or anyone who works in your Missouri home — is a W-2 employee. Missouri household payroll is mostly straightforward: DES unemployment filings, optional state income tax withholding by agreement, no statewide paid leave, and a local 1% earnings tax issue in Kansas City and St. Louis.

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✓ Updated May 2026 · Verified against Missouri Department of Revenue, MO Division of Employment Security, MO Division of Workers Compensation, and IRS
State Income Tax0%–4.7%
Minimum Wage$7.25/hr
UI Rate~2.7%
Workers' Comp5+ employees
Local TaxKC / STL
Missouri is moderately simple for household payroll, with one local-tax wrinkle. The main Missouri-specific items are employer-paid unemployment insurance after the $1,000 quarterly threshold, optional Missouri income-tax withholding by mutual agreement, and possible 1% local earnings tax in Kansas City or St. Louis. Missouri does not have statewide paid sick leave or PFML, and most households are below the workers' comp employee-count threshold.
Your household worker is a W-2 employee. Whether they're a nanny, caregiver, housekeeper, gardener, or personal assistant — if you control when, where, and how the work is done, they are your employee under IRS rules. That means W-2 reporting, payroll tax compliance, and federal labor law obligations. Most household workers are employees under IRS rules, not contractors — issuing a 1099 in this situation can lead to back tax penalties, interest, and wage-law liability.

When the rules apply

Missouri household employers mainly need to watch the federal payroll thresholds and the $1,000 quarterly Missouri unemployment threshold:

2026 Thresholds
$3,000
Federal · 2026
Triggers Social Security and Medicare taxes (FICA) and W-2/W-3 reporting.
$1,000
Federal/quarter
Triggers federal unemployment tax (FUTA) and Missouri Division of Employment Security registration.
$1,000
State/quarter
Cash wages to all household employees combined in any calendar quarter. Triggers Missouri DES registration and employer-paid UI 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 payroll taxes, and registers you with Missouri DES once the $1,000 quarterly threshold applies.

Federal taxes — quarterly EFTPS payments

At the end of each federal quarter (March, May, August, December), Nest debits your bank account for the federal taxes owed — FUTA, employer + employee FICA, and any federal income tax withheld — and remits them to the IRS via EFTPS. You'll get a confirmation email a week beforehand. Your money stays in your account until taxes are actually due. We don't hold withholdings on your behalf. At year-end, Schedule H on your Form 1040 reconciles everything Nest already paid through the year; Nest produces a signature-ready version.

Missouri state taxes — quarterly UI filings

Each quarter, Nest files the Quarterly Contribution and Wage Report (MODES-4-7) with the Missouri Division of Employment Security for state UI tax — an employer-paid contribution, not withheld from your employee.

Missouri UI tax: New household employers generally pay around 2.7% on the first $9,000 of each employee's wages. This is employer-paid and not withheld from your employee. Nest calculates and remits this with quarterly MODES-4-7 filings once registration applies. Source: Missouri Division of Employment Security
Missouri state income tax: Missouri uses graduated personal income tax rates up to 4.7%. State income-tax withholding is voluntary for household employers and requires agreement with your employee. The state withholding certificate is Form MO W-4.

Local earnings tax: Kansas City and St. Louis each impose a 1% earnings tax for residents and for wages earned within the city. Check the applicable city before assuming local withholding is required. Source: Missouri Department of Revenue
End-of-year reconciliation: If you didn't cross the federal FICA threshold ($3,000/year per employee — most common when families start payroll late in the year or hire short-term help), we'll let you know exactly what was withheld but doesn't need to be remitted. You return those amounts to your employee, and we file accordingly.

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Nest handles MO UI registration, paystubs, quarterly Missouri DES filings, and year-end Schedule H — all for $42/mo.

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Setup checklist (before they start)

Missouri Workers' Compensation Insurance — voluntary for most households

Under RSMo § 287.030, Missouri requires workers' compensation coverage for employers with 5 or more employees. Households with fewer than 5 employees are not required to carry coverage. Domestic workers are also generally excluded under §287.090.

However, voluntary coverage is still worth considering. Workers' comp can protect you if your employee is injured on the job and gives the employee a predictable benefits path without a lawsuit.

Without coverage: An injured household worker may be able to sue you directly for workplace injury costs. Talk to your insurance agent about whether your homeowner's or umbrella policy covers domestic-employee injuries.

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 MO W-4 (Missouri withholding certificate)

The federal W-4 determines how much federal income tax to withhold from each paycheck. Missouri requires its own state withholding certificate, Form MO W-4, which uses filing status only (no allowances since the form was revised). If your employee lives in or works in Kansas City or St. Louis, they may also need to file local earnings tax forms.

Federal and Missouri income tax withholding are both voluntary for household employers and require mutual agreement between you and your employee.

Missouri New Hire Reporting

Report new hires to the Missouri New Hire Reporting Center within 20 days of the start date. You can file online at the link above. Federal law requires this; MO penalty for failure is up to $25 per missed report.

Required Employment Posters

Even with a single household employee, the following workplace posters are required (or equivalent notification, since your home isn't a typical workplace):

For a household setting, a single binder kept in a common area satisfies the posting obligation in most cases.

Written Work Agreement

Missouri does not require a written employment agreement, but it's strongly recommended. A clear written agreement reduces misunderstandings and protects both parties when situations come up that you didn't anticipate.

Use our free nanny contract template as a starting point — it covers compensation, hours, duties, vacation, sick time, confidentiality, and at-will employment language.

Pay & compensation

Minimum Wage — federal floor of $7.25/hr

Missouri has a higher general minimum wage, but domestic workers in private homes are generally exempt from the Missouri minimum wage statute. For household employees, the federal $7.25/hr floor controls. In practice, nanny and caregiver market rates in St. Louis, Kansas City, Springfield, and Columbia are usually much higher.

Overtime — 1.5× regular pay over 40hr/week

Federal Fair Labor Standards Act (FLSA) overtime rules apply: live-out household employees get 1.5× their regular hourly rate for any hours over 40 in a workweek. Live-in household employees are exempt from federal OT (FLSA exemption for live-in domestic workers), and Missouri has no state OT requirement that overrides this.

Missouri Overtime Rules
Worker typeOT triggerRate
Live-out (most nannies, housekeepers, caregivers)Over 40 hr/week1.5× regular
Live-inFLSA-exempt — no OT required1.0× regular

"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, Missouri withholding, local earnings tax, or payroll records.

With Nest Payroll: Nest tracks qualified overtime reporting for W-2 purposes when required.

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 RSMo § 290.080, employers must pay wages at least semi-monthly, within sixteen days of the end of each pay period. Most household payroll arrangements pay weekly or biweekly to keep cash flow predictable for both sides.

Mileage Reimbursement

Missouri does not have a state-mandated mileage reimbursement rate for private employers. If your employee uses their own car for work-related driving (errands, school pickup, doctor's appointments for the children), reimburse at the federal IRS standard mileage rate — $0.70/mile for 2026. Reimbursements at or below the federal rate are not taxable wages.

Paystub Requirements

Missouri does not have a specific statute requiring itemized paystubs, but you should provide them anyway for clear recordkeeping. Each paystub should show: gross wages, hours worked, deductions (federal income tax, FICA, MO PIT), net pay, and pay period dates.

With Nest Payroll: Nest generates a compliant earnings statement (pay stub) for every pay period — automatically. You can email each stub to your employee from the app, or download a PDF.

Time off & leave

Paid Sick Leave — none required statewide

Missouri does not currently require statewide paid sick leave for household employers, and no Missouri city has a local paid sick leave ordinance. Sick time is offered at the employer's discretion.

If you choose to offer sick leave, common household-employer practice is 5–10 days/year, usable for the employee's own illness or to care for an immediate family member.

Vacation & PTO

Missouri does not require paid vacation. If you offer it, document the policy in writing — under Missouri law, vacation pay is enforceable to the extent your written policy states it will be paid out at separation. A clear policy with a written cap (or "no payout at separation" provision) protects you.

Frontloading at the start of each year is the simplest approach. If you offer paid vacation, set the annual amount upfront and let your employee draw against it as time is used — no per-pay-period accrual tracking, no carryover headaches at year-end. See our frontload PTO & payout guide for the calculation method when payout does apply (earned-but-unused, pro-rated through the last day worked, at the final rate of pay).

Upon departure

When the working relationship ends — Missouri's final pay rule (RSMo § 290.110) requires final wages to be paid on the day of discharge for involuntary terminations (employer-initiated). For employee resignations, final pay is due on the next regular payday.

At separation, give your employee a final paystub and a copy of any timekeeping records you've maintained. If you've offered vacation as part of your written policy, pay out the earned-but-unused portion (pro-rated through the last day worked, at the final rate of pay) per your policy.

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 MODES-4-7 filings with Missouri DES once registration applies
  • MO W-3 annual reconciliation when Missouri withholding applies
With Nest Payroll: Your tax forms are generated automatically and appear in your Tax Summary by the end of January.
Bonuses and vacation payouts: Bonuses and vacation payouts are included on your employee's W-2 and taxed through regular payroll withholding calculations.

Tax breaks for household employers

Two federal tax breaks may help offset your nanny payroll costs:

1. Dependent Care FSA (DCFSA). Through your employer's benefits, you can set aside up to $7,500/year (2026 OBBBA increase from $5,000) in pre-tax dollars to pay for childcare for kids under 13. This typically saves 25–35% on the contributed amount, depending on your federal + state tax bracket.
2. Child & Dependent Care Tax Credit. On your federal Form 1040, claim 20–35% of qualifying childcare expenses (up to $3,000 for one child / $6,000 for two or more). The percentage scales based on your AGI.

For nannies caring for school-aged kids, families often use the DCFSA first (better tax savings for most), then claim the credit on any expenses above the FSA limit. Note: you cannot claim the same expenses under both — but you can split them.

Resources & free tools

🧮 Nanny Payroll Calculator ⏪ Catch-Up Calculator ↗ Gross-Up Calculator 📄 Free Contract Template 🏖️ Frontload PTO & Payout Guide 📚 Nanny Payroll 101

The information on this page is general in nature and not tax, legal, or financial advice. Missouri rules change. Verify current rates and rules at Missouri Department of Revenue and Missouri Department of Labor and Industrial Relations, or consult a tax advisor.