Paying Your Minor Children

[Jennifer91]

I was wondering if anyone out there pays there own children. I heard of people doing this but wondering if anyone out there has any experience with it? Here is the link.

Paying your kids article (http://www.bargaineering.com/articles/kids-money-paying-child-wages-working-home-business.html)

[Countrygal]

I have been looking into moving to another state, and I know this one varies by state. :P No help, I know. Sorry.

[Blackcat31]

Tom has said the following on his blog about hiring our own children as helpers:

"Hiring Your Own Children

One note about hiring your own children: If you hire your own child who is age 18 or older you still must withhold and pay Social Security/Medicare taxes and withhold federal and state income taxes. But you won't owe federal unemployment taxes. Contact your state for your state rules. As a result, I believe it makes more sense to give this child gifts, unless you want your child to learn what it's like to be an employee.

If your own child is under age 18 there is no Social Security/Medicare taxes, no state or federal tax withholding and your child care earn up to $5,700 and not owe any federal income taxes. Therefore, there is a tax benefit to your family in that you can deduct the wages you pay and the child probably won't have to pay any taxes. As a result, you may want to treat your younger children as employees."

http://www.tomcopelandblog.com/2011/02/to-hire-a-relative-or-not.html

[Sunchimes]

Here is a post on Tom's blog on this subject.
http://www.tomcopelandblog.com/hiring-family-members.html

Another possible benefit could be that you could set up a Health Reimbursement plan for the child if he was an employee. Here is some info from the blog about an HRA--the next to last sentence of the post address the child part, the rest is about HRA.

If you don't have his Record-Keeping guide, I highly recommend it. I've worn out the pages and marked it up, and I've only had it a couple of months. It's saving us tons!!

[Countrygal]

Tom, are there not state laws that also apply here? I believe in WI, where I live, for instance, you cannot officially "hire" your own child unless they are at least 12 yo and then the hours are strictly regulated. I have never actually dealt in this, but have had many home-schooling friends who have and I am pretty sure there were state laws that limited the involvement the children could have as "employees". Am I incorrect? I tried looking it up online and it appears that our state law says age 12, but I might be reading it incorrectly.

[TomCopeland]

Tom, are there not state laws that also apply here? I believe in WI, where I live, for instance, you cannot officially "hire" your own child unless they are at least 12 yo and then the hours are strictly regulated. I have never actually dealt in this, but have had many home-schooling friends who have and I am pretty sure there were state laws that limited the involvement the children could have as "employees". Am I incorrect? I tried looking it up online and it appears that our state law says age 12, but I might be reading it incorrectly.

When hiring your own children you must follow both federal and state laws. Some states have stricter standards and forbid hiring below a certain age. Therefore, it's always a good idea to call your state department of labor to find out your state rules.