During these economic times it is tempting, to accept a nanny position that pays cash under the table. Don't do it. For one thing it really cheapens our profession. It's illegal and both you and your employer can be fined if caught. When you are a Nanny, you are an employee of that family and all necessary taxes should be withheld by the family or their accountant.
I've been told by many families that a 1099 is sufficient. No, they are wrong. You are not a private contractor. It creates problems for you when you file. If you list, you are a nanny on your tax forms, then the IRS will go after the family.
Most of us, at some time or another want to be able to eventually use our documented income, to purchase homes, buy a car, etc. When families try to take a shortcut, they are not thinking of you, the Nanny, they are thinking only of themselves.
Don't fall for it. Cash under the table or a 1099. Its not right.