Why You Might Want to Consider Putting Your Children on Payroll
Free Book Preview Tax and Legal Playbook
Yes, you can legally add your children to your company's payroll, according to attorney and accountant Mark Kohler. Different rules apply depending on the age of your child:
Children age 18 and older: If they are away at college, consider declaring them as part-time employees with 10-99 status for a tax write-off. If they work more hours and have dedicated office space, you may have to make them full-time employees.
Children younger than age 18: Make sure they are legitimately working for your business, Kohler says, and to pay them from a sole proprietorship -- not a corporation.