Employ Your Kids - and Save

Employ Your Kids - and Save

If you own a small business, hiring your children can be a great way to cut taxes on your income by shifting it to someone who is taxed at a lower (sometimes zero) rate. The main requirement is that family employees must be at least seven years old. Then the first $5,700 of their earned income is not subject to income tax, since that is the current standard deduction for a single taxpayer.

Keep in mind you must pay what is considered a "reasonable" wage for services performed by a family employee. A "reasonable" wage is what you would otherwise pay a commercial vendor for the same service, after making an adjustment for the child’s age and experience. If a landscaping service would charge $20, it’s reasonable to pay your child the same amount since cutting grass is considered to be relatively unskilled labor.

What is New

Stock Market

Stocks headlines
Index Last Change
Dow 16434.29 9.44
Nasdaq 4105.76 19.54
S&P 500 1867.67 5.36
NYSE 10546.39 40.61
AMEX 2592.16 -2.19
Input stock ticker 
Or company name