DCAP

Pay Your Childcare Providers Legally - It's Cheaper!

Have you heard of the American Rescue Plan? How about Dependent Care Savings Accounts or the Childcare Tax Credit? These may sound complicated, however really they’re not. In addition, these plans are of huge benefit to parents with children. If you are looking at using any type of childcare such as a nanny, babysitter, infant care nurse or even a day care service, read on.

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The US government recently improved benefits for families massively during 2021. However, in order to access such benefits, you must pay for childcare by the books. No more cash or checks under the table guys!

NannyPod Childcare Tax Credits 2021 - Savings using a DCFSA for 1 child or 2 children

There are great childcare cost calculators available to help you budget and work out the math. In addition, your childcare provider will accrue important long term benefits such as social security and even unemployment. Paying under the table doesn’t help them with these, so it’s in everyone’s best interest to play by the rules.

NannyPod savings by paying your childcare provider or nanny legally in 2021

If you are unsure about what to do, we recommend talking to a qualified CPA or CFP to help guide you. Navigating these waters is not too difficult with a bit of help from a professional.

There are also a couple of software resources like NannyPay to do the heavy lifting. You’ll avoid the paranoia too of any type of IRS tax audit where you inadvertently fell afoul of the rules and the ‘nanny tax’.


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NannyPod provides long term nanny matches and short term occasional date-night babysitters and infant care on demand, at an affordable price. Our service is convenient, safe and secure for families and our staff. Parents can request childcare instantly by using the NannyPod app. Get started with NannyPod today and find babysitters or nannies for your childcare needs!

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