Ryan Vaughn explains how wealthy people pay their kids to work in the family business. The children owe no federal income tax if earnings stay under the standard deduction of $12,500, and the parent avoids payroll taxes on those wages, cutting the family's total tax bill.
Another strategy that the rich do, but even some of our clients who, they would say, I don't feel rich, but they have a business and they wanna lower their taxable income, they hire their children. You can employ your children in an unincorporated business, and then you don't pay payroll tax on that money that goes to your children. And if you're paying your children under the standard deduction, which as of this video is $12,500, they don't pay income tax on it either.
