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Discussion:Hiring children as Household employees
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Discussion Forum Index --> Tax Questions --> Hiring children as Household employees
Holymoley (talk|edits) said:
| 19 July 2007
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| In order to fund an IRA for children member wants to pay children as household employee with w-2 or 1099 to allow child to fund an IRA. Any problem with this. I know no Sch H if paid less than $1,500.
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Jdugancpa (talk|edits) said:
| 19 July 2007
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| Pay needs to be reasonable given level of skill required. Have client keep time records as well. I also assume client is looking at funding a ROTH, not a conventional IRA and keeping wages below filing threshold for the kids. Also, if parent gives kids 1099 for more than $400 kids with be subject to SE tax. No FICA tax due on wages paid to kids (below 18??). So need to issue W-2, not 1099.
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Kevinh5 (talk|edits) said:
| 20 July 2007
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| 1099 would not avoid SS/SE tax, while W-2 would. Which is it better to do, pay more in taxes or pay more to the accountant?
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Larry0434 (talk|edits) said:
| 20 July 2007
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| Children working for their family are exempt from Social Security Taxes.
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Death&Taxes (talk|edits) said:
| 20 July 2007
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| As working employees they are exempt, not as Independent Contractors on a 1099-MISC Non-employee Compensation.
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