Daniel HonanFounder, Profitable Painter CPA PLLC · I help painting contractors increase profits & cash flow while reducing taxes♦ Bookkeeping ♦ Tax

Painting Contractors: Shocking Secret to Slash Your Tax Bill Hiring Your Kids

Name: Painting Contractors: Shocking Secret to Slash Your Tax Bill Hiring Your Kids
Uploaded: 2023-06-22T16:15:11+00:00
Duration: 55 s
Channel: Daniel Honan
Description: Painting contractors can hire their kids and pay them up to $13,000 a year tax-free, shifting income from the owner's 24% or 32% tax bracket to the…

22 Jun 2023 · 1 min

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Painting contractors can hire their kids and pay them up to $13,000 a year tax-free, shifting income from the owner's 24% or 32% tax bracket to the child's zero tax rate. The strategy uses the standard deduction to eliminate the child's tax liability while reducing the owner's overall tax bill.

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and that is employing your children in your business. The idea is that we want to shift money that we're earning and that's being taxed at a higher tax bracket over to somebody who has a lower tax bracket. And if you filed your taxes before, you know that a certain amount of money is not taxed right off the bat. They call that the standard deduction. And in 2023, the amount for a single taxpayer is $13,850. So if you could take $13,000 of money that, that is normally going to be taxed at your tax bracket, that might be 24% or 32% or even higher, and shift that over to one of your kids and have it taxed at zero, you know, the benefit's pretty clear, right?