The Untold Benefits of Hiring Your Kids in Your Business
The Untold Benefits of Hiring Your Kids in Your Business  
Podcast: Small Business Tax Savings Podcast
Published On: Wed Nov 08 2023
Description: Send us a textHiring one's children is an often overlooked but incredibly beneficial strategy. With IRS regulations allowing for business deductions for wages paid to those under 18, this can be an effective pre-tax spending and money-saving opportunity for parents. In this episode, we'll discuss the importance of having proper documentation in place when utilizing this strategy, as well as creative ways to use your child's skills in your business while teaching them valuable lessons in financial management and responsibility. We'll provide resources to help you create documents and templates valid when dealing with the IRS, including a job description, employment agreement, worksheet tracking task/date/hours worked, payment proof, and W-2. Plus, we'll explore how hiring your children can move after-tax spending into pre-tax spending - so don't miss out on this super informative episode![00:27] Hiring Your Kids: Get a Business Deduction and Potentially Pay No TaxHiring your kids is allowed by the IRS and provides benefits that don't apply to other peopleYou get a business deduction, and your child potentially pays no income tax on that incomeYou can pay your child out of a sole proprietorship without having to withhold for social security, Medicare, or federal unemployment taxesYour child can claim the standard deduction of 13,850, and any income over that will be taxed at the lowest bracket[04:23] Things You Need to Know Before Hiring Your ChildThe child must be age seven or older The child must be paid a reasonable rate for the type of work they are doing in your businessTrack time, tasks, and dutiesPay to an account in the child's nameHave a job description, employment agreement, and worksheetMike shares the other benefits of hiring your child[10:32] S Corporation and Non-Direct ChildrenIf you operate as an S Corporation, you need to withhold for social security, Medicare, and federal unemploymentYou can also hire non-child family members but would need to withhold for social security, Medicare, etc.The Time Is NOW To Start Paying Less In Taxes. Join Our Tax Minimization Program (with Stress-Free Bookkeeping Training)! Join Our Tax Minimization Program Today!Key Quotes"I've never found a business where their child couldn't do something for their business. And that's as business owners; we need to start thinking, what can our child be doing for our business?" – Mike Jesowshek, CPA"There's a lot of extra benefits to hiring your children over and above just the tax benefits. Your child's starting to understand working for a living and getting paid, and now they can go buy their things and they start to learn money management." – Mike Jesowshek, CPA______Podcast Host: Mike Jesowshek, CPA - Founder and Host of Small Business Tax Savings PodcastJoin Our Tax Minimization Program: https://www.taxsavingspodcast.com/taxIncSight Packages: https://incsight.net/pricing/Book an Initial Consultation: https://app.simplymeet.me/o/incsight/sale-------Podcast Website: https://www.TaxSavingsPodcast.comFacebook Group: https://www.facebook.com/groups/taxsavings/--------To find out more on this topic and many others visit our website at www.TaxSavingsPodcast.com. You can also give us a call at 844-327-9272 or send your questions to us at: Ask@TaxSavingsPodcast.com