When families seek to lighten the burden of household chores such as cleaning, or when working couples need someone to care for their children, a determination must be made regarding whether these workers are independent contractors or employees. The decision affects the way that taxes are paid and by whom.
The IRS has a defined set of rules that apply to these types of situations. Independent contractors are those who offer their services to the general public such as lawyers, accountants, doctors, and dentists. If you can control the details of the work you provide, you are usually an independent contractor.
If your cleaning is done by a cleaning crew, they are not employees generally, but are independent contractors. If your cleaning lady uses your equipment and supplies and you tell her what to do in detail, and when to do it, she is likely an employee.
Your nanny, in all likelihood, is also an employee. Most working couples dictate a detailed schedule and set of rules for their nannies. They may require a nanny to feed only certain foods and to stick to a schedule for naps and other events. In short, the parents are directly in charge of all aspects of the performance of the nanny. The nanny has little flexibility and parents can jump in at any time and direct what should be done, when, and how to do it.