Know the Rules for Hiring your Kids to Work in Your Small Business?
Hiring your kids to work in your small business can be a great idea. You can teach them the value of a hard-earned dollar and their compensation may be tax deductible, minimizing your business taxable income. Here are some things to consider…Make sure their pay is commensurate with their age, experience, and education. If their title is “manager”, make certain they are capable of and actually managing others.
Paying your children an executive level salary to sweep the floors is almost certain to bring about an unfavorable decision by the IRS.