diff --git a/index.js b/index.js
index ac53bfe0..ba93cdb6 100644
--- a/index.js
+++ b/index.js
@@ -91,15 +91,7 @@ module.exports = {
       return options;
     } else {
       // legacy codepath
-      let transpilerOptions = this._buildBroccoliBabelTranspilerOptions(config);
-
-      return {
-        ...transpilerOptions,
-        babel: {
-          ...transpilerOptions.babel,
-          ...options,
-        },
-      };
+      return Object.assign({}, this._buildBroccoliBabelTranspilerOptions(config), options);
     }
   },
 
@@ -134,19 +126,20 @@ module.exports = {
 
     let options = {
       annotation: providedAnnotation || `Babel: ${_parentName(this.parent)}`,
+      sourceMaps,
       throwUnlessParallelizable,
       filterExtensions: this.getSupportedExtensions(config),
-      babel: { plugins: [], sourceMaps },
+      plugins: [],
     };
 
     if (shouldCompileModules) {
-      options.babel.moduleIds = true;
-      options.babel.getModuleId = require("./lib/relative-module-paths").getRelativeModulePath;
+      options.moduleIds = true;
+      options.getModuleId = require("./lib/relative-module-paths").getRelativeModulePath;
     }
 
-    options.babel.highlightCode = _shouldHighlightCode(this.parent);
-    options.babel.babelrc = false;
-    options.babel.configFile = false;
+    options.highlightCode = _shouldHighlightCode(this.parent);
+    options.babelrc = false;
+    options.configFile = false;
 
     return options;
   },
@@ -155,13 +148,30 @@ module.exports = {
     let config = _config || this._getAddonOptions();
     let description = `000${++count}`.slice(-3);
     let postDebugTree = this._debugTree(inputTree, `${description}:input`);
-    let transpilerOptions = this._buildBroccoliBabelTranspilerOptions(config);
-    let babelOptions = this.buildBabelOptions('babel', config);
+    let {
+      // Separate Babel options from `broccoli-babel-transpiler` options.
+      babelrc,
+      configFile,
+      getModuleId,
+      highlightCode,
+      moduleIds,
+      plugins,
+      sourceMaps,
+      ...transpilerOptions
+    } = this._buildBroccoliBabelTranspilerOptions(config);
     let options = {
       ...transpilerOptions,
+      // `broccoli-babel-transpiler` now expects all Babel options to be
+      // present under a `babel` key.
       babel: {
-        ...transpilerOptions.babel,
-        ...babelOptions,
+        babelrc,
+        configFile,
+        getModuleId,
+        highlightCode,
+        moduleIds,
+        plugins,
+        sourceMaps,
+        ...this.buildBabelOptions('babel', config),
       },
     };
 
diff --git a/node-tests/addon-test.js b/node-tests/addon-test.js
index cf641c5d..8b70fa32 100644
--- a/node-tests/addon-test.js
+++ b/node-tests/addon-test.js
@@ -1592,7 +1592,7 @@ describe('ember-cli-babel', function() {
 
       let result = this.addon._buildBroccoliBabelTranspilerOptions(options);
 
-      expect(result.babel.babelrc).to.be.false;
+      expect(result.babelrc).to.be.false;
     });
 
     it('provides an annotation including parent name - addon', function() {
@@ -1632,7 +1632,7 @@ describe('ember-cli-babel', function() {
       };
 
       let result = this.addon._buildBroccoliBabelTranspilerOptions(options);
-      expect(result.babel.sourceMaps).to.equal('inline');
+      expect(result.sourceMaps).to.equal('inline');
     });
 
     it('disables reading `.babelrc`', function() {
@@ -1640,7 +1640,7 @@ describe('ember-cli-babel', function() {
 
       let result = this.addon._buildBroccoliBabelTranspilerOptions(options);
 
-      expect(result.babel.babelrc).to.be.false;
+      expect(result.babelrc).to.be.false;
     });
   });
 
@@ -1653,9 +1653,9 @@ describe('ember-cli-babel', function() {
       let result = this.addon.buildBabelOptions();
 
       expect(result.annotation).to.equal('Babel: foo');
-      expect(result.babel.moduleIds).to.be.true;
-      expect(result.babel.babelrc).to.be.false;
-      expect(result.babel.configFile).to.be.false;
+      expect(result.moduleIds).to.be.true;
+      expect(result.babelrc).to.be.false;
+      expect(result.configFile).to.be.false;
     });
 
     it('returns broccoli-babel-transpiler options when asked for', function() {
@@ -1664,9 +1664,9 @@ describe('ember-cli-babel', function() {
       let result = this.addon.buildBabelOptions('broccoli');
 
       expect(result.annotation).to.equal('Babel: foo');
-      expect(result.babel.moduleIds).to.be.true;
-      expect(result.babel.babelrc).to.be.false;
-      expect(result.babel.configFile).to.be.false;
+      expect(result.moduleIds).to.be.true;
+      expect(result.babelrc).to.be.false;
+      expect(result.configFile).to.be.false;
     });
 
     it('returns broccoli-babel-transpiler options with customizations when provided', function() {
@@ -1677,9 +1677,9 @@ describe('ember-cli-babel', function() {
       });
 
       expect(result.annotation).to.equal('hello!!!');
-      expect(result.babel.moduleIds).to.be.true;
-      expect(result.babel.babelrc).to.be.false;
-      expect(result.babel.configFile).to.be.false;
+      expect(result.moduleIds).to.be.true;
+      expect(result.babelrc).to.be.false;
+      expect(result.configFile).to.be.false;
     });
 
     it('returns babel options when asked for', function() {
@@ -1726,7 +1726,7 @@ describe('ember-cli-babel', function() {
       });
 
       let result = this.addon.buildBabelOptions();
-      expect(result.babel.plugins).to.deep.include(plugin);
+      expect(result.plugins).to.deep.include(plugin);
     });
 
     it('includes postTransformPlugins after preset-env plugins', function() {
@@ -1744,8 +1744,8 @@ describe('ember-cli-babel', function() {
 
       let result = this.addon.buildBabelOptions();
 
-      expect(result.babel.plugins).to.deep.include(plugin);
-      expect(result.babel.plugins.slice(-1)).to.deep.equal([pluginAfter]);
+      expect(result.plugins).to.deep.include(plugin);
+      expect(result.plugins.slice(-1)).to.deep.equal([pluginAfter]);
       expect(result.postTransformPlugins).to.be.undefined;
     });
 
@@ -1765,7 +1765,7 @@ describe('ember-cli-babel', function() {
       });
 
       let result = this.addon.buildBabelOptions(options);
-      expect(result.babel.presets).to.deep.equal([]);
+      expect(result.presets).to.deep.equal([]);
     });
 
     it('user plugins are before preset-env plugins', function() {
@@ -1780,7 +1780,7 @@ describe('ember-cli-babel', function() {
       });
 
       let result = this.addon.buildBabelOptions();
-      expect(result.babel.plugins[0]).to.equal(plugin);
+      expect(result.plugins[0]).to.equal(plugin);
     });
 
     it('includes resolveModuleSource if compiling modules', function() {
@@ -1792,7 +1792,7 @@ describe('ember-cli-babel', function() {
           compileModules: true,
         }
       });
-      let found = result.babel.plugins.find(plugin => plugin[0] === expectedPlugin);
+      let found = result.plugins.find(plugin => plugin[0] === expectedPlugin);
 
       expect(typeof found[1].resolvePath).to.equal('function');
     });
@@ -1806,7 +1806,7 @@ describe('ember-cli-babel', function() {
           compileModules: false,
         }
       });
-      let found = result.babel.plugins.find(plugin => plugin[0] === expectedPlugin);
+      let found = result.plugins.find(plugin => plugin[0] === expectedPlugin);
 
       expect(found).to.equal(undefined);
     });
@@ -1842,7 +1842,7 @@ describe('ember-cli-babel', function() {
 
       let options = this.addon.buildBabelOptions();
 
-      expect(options.babel.presets).to.deep.equal([
+      expect(options.presets).to.deep.equal([
         [require.resolve('@babel/preset-env'), {
           loose: true,
           modules: false,