Mark Kohler explains how small-business owners can legally employ their kids under 18 and claim tax deductions. Children don't owe federal taxes on income up to the standard deduction, and you should never issue them a 1099. A sole proprietorship or non-S-corp structure works best.
If you have a small business and you have children under age 18 and they are helping you legitimately in the business freaking pay them you get a tax write off. They do not have to file a federal tax return or pay tax on the income under the standard deduction so if you pay them you get a write off they don't have to file and because they're under age 18 and you pay them out of the proper entity not an S corp. We usually set up a sister company for this. More podcasts and trainings on that you can get from us. But you do not issue a child under age 18 a 1099 ever. Yes accountants out there you're probably wanting to put your fingernails on a chalkboard but no do not do it and I've got all the authority and backup for this in multiple writings. When your child is under age 18 when you pay them out of a sole proprietorship you are not required to give them a 1099 even if you pay them 100 freaking grand.
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