Paul L. Caron

Monday, November 27, 2023

Kleiman, Sarkar & Satterthwaite Present Towards An Understanding Of Nannies' Tax Experiences And Preferences Today At Loyola-L.A.

Ariel Jurow Kleiman (Loyola-L.A.; Google Scholar), Shayak Sarkar (UC-Davis; Google Scholar), and Emily Satterthwaite (Georgetown; Google Scholar) present Towards an Understanding of Nannies' Tax Experiences and Preferences at Loyola-L.A. today as part of its Tax Policy Colloquium hosted by Katie Pratt:

Kleiman-sarkar-satterthwaiteDespite their indispensable work, nannies in the U.S. often work long hours for low wages and fear retaliation if they complain about work or pay conditions. Exacerbating this precarity is the fact that many nannies work “off the books” and thus must keep their work secret not only from state and federal tax agencies, but from employment and labor agencies as well. This Article investigates nannies’ preferences for or against formal employment and tax reporting, the reasons behind such preferences, and how such preferences correspond to nannies’ relationships with their employers and with society more broadly. 

The Article employs a two-pronged research approach that includes a survey of nannies and an analysis of nannies’ recent tax-related posts on the online forum Reddit. To supplement this research, the Article also discusses interviews with fifteen subject-matter experts regarding industry norms, common challenges nannies face, and policy reforms.

We find that nannies’ preferences are diverse, reflecting a complex trade-off between tax costs (borne either by the nanny, the parent-hirer, or both), eligibility for social safety net benefits, and other costs and benefits of formal employment. While a preference for formality was dominant among nannies who took the survey as well as Reddit posters, those nannies may not be representative of the general nanny population. Indeed, subject-matter experts suggested that a non-insignificant proportion of nannies prefer informal work, especially those who are less visible, harder to reach in surveys, and vulnerable with respect to immigration status, need for cash, or reliance on public benefits.  These findings should inform nanny tax enforcement and other policies that respect the well-being of nannies, as well as other workers in the domestic and child-care sectors. 

Commentators: Jonathan Harris (Loyola-L.A.; Google Scholar) and Polly Bone (Texas Taxpayer Assistance Project)

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