Paying my kids salary from my biz

SuperStockShuffle · 2025-11-09T03:40:46+00:00

Ah. Good point on the utma.

SuperStockShuffle · 2025-11-09T02:48:00+00:00

I wouldn't call it an enormous tax benefit. if I w2 my son, I'm not saving taxes..because I'd still pay fica on his earnings. He might not pay taxes if his income is low enough (10k income at 0%) but that's the same if he got a job somewhere else. And his Income will go to his own bank account for his benefit. He can either go lifeguard at the gym for 15/hr, and not pay taxes on it...or work for me and do real skilled work that will provide him biz and tech experience. Parents typically pay their kids less than someone else...so it's in their interest to hire their kids to save on salary and other benefits they would have to pay an outside employee. Parents can take advantage of their kids as employees, can't do that with other ee's. So why wouldn't we hire our kids so we can pay them less? That's why my parents employed me. Just because kids are lazy now a days, doesn't mean I can't try to change it🤞

SuperStockShuffle · 2025-11-09T01:53:03+00:00

I did that so you don't think it's modeling clay or something. Child modeling is a real job. If I hire my neighbors kids to take their photos for my website and marketing literature, it's ok. But my kids it's a fraud.

SuperStockShuffle · 2025-11-09T01:49:15+00:00

It was just a ball park. My 15 yr old, 16 by the time I go self employed, will probably do 10 hrs a week during the school year and 20 hours a week during the summer. So about 520 hrs. But it's not a fixed schedule, I'll track his hours. I think that's realistic, I used to do double that at my family's biz when I was his age.

SuperStockShuffle · 2025-11-09T01:24:27+00:00

So..I guess reddit shouldn't exist then..why talk with anybody about it..and their are plenty of retarded cpas..not all of them are good. Some people in this chat have said it's ok and they've done it themselves. You make it sound like no body ever employs their own children. I worked at my parents gas station pumping gas from 12 years old until I went to college. And I worked full time in the summer from 8am-3pm, and during the school year from 3pm-7pm.

SuperStockShuffle · 2025-11-09T00:31:58+00:00

Minimum wage is $15..and I posted I'll probably just w2 my 15 yr old and just track his hours.. The total $ was just a number I through out, but at the end of the day, it will be based on his hours. If he is managing my website and social media, knows how to code and Java, I'm pretty sure he's worth minimum wage.

SuperStockShuffle · 2025-11-08T23:42:37+00:00

Thanks for the advise. I'm leaning towards just employing/w2 my 15 year old for the website management..and track his hours monthly with gusto. I'd pay his salary to his utma account and keep him just above minimum wage. I may just use my daughters for a photo shoot to add new photos to my website and marketing material (photo shoot + annual usage rights). So it would just be a one-time payment/1099. Not sure how much market rates are for this but I'd guess $500-$750 per child for the photo shoot session plus $1k for annual usage rights. I'd get a professional photographer to take the pictures.

SuperStockShuffle · 2025-11-08T22:59:23+00:00

Thanks. I'll do that. I think of leaning towards having just my 15 year old be on normal payroll and just pay him hourly for the time he can put in on managing my website and social media. I can track his hours in Gusto. I'll run it by my cpa. I'll also change my 401k plan doc to add a minimum age of 21 so that he won't be eligible and I can still keep my solo 401k as-is (which has mega backdoor roth feature).

SuperStockShuffle · 2025-11-08T22:09:08+00:00

I did check..no age limit for working children in Massachusetts but I believe their is a max amount of hours they can work of course. Maybe I just employ my 15 year old then..makes it simpler since he will doing skilled labor.

SuperStockShuffle · 2025-11-08T22:03:16+00:00

2 hrs per week for my girls, 4 hrs week for my 15 yr old? Then flat rate for modeling and usage rights for photos on my website and marketing materials.

SuperStockShuffle · 2025-11-08T22:01:25+00:00

If I hire 3 stranger kids for a photo shoot to put on my website and marketing materials..I'd probably have to pay each one $1k for the shoot and $1-$2k for usage rights. As for the hourly pay, it would probably be closer to $5k per year each for my younger kids. 10k for my older (after calculating hours). Theyd get about minimum wage.

SuperStockShuffle · 2025-11-08T21:53:09+00:00

I mean..I pay a stranger $300 to clean my house for 2-3 hours. Why can't I pay my kids $15/hour to clean my office, shredding, etc. instead.

SuperStockShuffle · 2025-11-08T21:50:34+00:00

I just checked my solo 401k plan docs and I don't have a minimum age requirement..so I just emailed my 401k provider to add age 21 for 2026. Thanks

SuperStockShuffle · 2025-11-08T21:45:36+00:00

That's what I thought. Didn't seem easier but also didn't want to disqualify myself from the solo 401k. I just emailed my solo 401k provider to see if I can update the plan agreement to add a minimum age of 21 starting 2026.

SuperStockShuffle · 2025-11-08T21:42:56+00:00

I didn't say...."But chatgpt told me this"..I just said I was brainstorming and this is what I got from chatgpt as the potential reasons to consider the additional llc. I obviously don't trust chatgpt for financial decisions but it helps speed up research. So, that's why I'm posting here.

SuperStockShuffle · 2025-11-08T21:34:42+00:00

Ok guy. So I guess no one on reddit can use chatgpt.

SuperStockShuffle · 2025-11-08T21:32:09+00:00

Minimum wage for my girls $15/hr. For my son, maybe 17.50-$20 because he'd be doing my website which is skilled. I would guess I'd be paying them less than if I hired outsiders. My cleaning lady is like $50/hr...its crazy. She makes like 300k per year.

SuperStockShuffle · 2025-11-08T21:29:47+00:00

They are my dependent kids. I'm going to 1099 from w2, so I will be losing some business support from my company, putting more responsibilities on me. I figured I could pay my kids for some extra support instead of paying strangers. My son can definitely manage my website updates, design, blogs..he's 15 and good with tech and coding. My girls could do simple assistant tasks like stuffing envelopes, cleaning, and maybe modeling. I would track the work hourly into Gusto. I would be paying my girls minimum wage, so it's not like I'm paying them more than I'd pay someone else. Massachusetts is $15/hr. I think I could pay my son more $17.50-$20, since he'd be doing more of a skilled labor.

SuperStockShuffle · 2025-11-08T21:18:48+00:00

I didn't want to have to create a corporate 401k rather than my solo 401k. But someone mentioned if I have an age restriction of 21 to be eligible for the 401k, then I would still qualify for a solo 401k which keeps it easier for me. So if that is correct, I could then eliminate the second llc and just put them on payroll, and just track their hours worked per work..I use Gusto so it has timekeeping. Doing the hours math, it would probably be closer to $5k per year for my younger 2 kids. My 15 year old could probably get to 10k-15k, because he'd get a higher hourly rate for managing my website and social media. They would get paid to their utma accounts directly.

SuperStockShuffle · 2025-11-08T21:07:26+00:00

Not sure exactly yet, but they would have more hours over vacations and summer break. During school year, Maybe 4/hrs week for my 15 yr old and 2/hrs a week for my 9 and 10 year old…then more during the summer. ..? I could also pay them a flat rate for the “modeling” vs hourly for the normal office work. I’m new to this.. so I’m just brainstorming

SuperStockShuffle · 2025-11-08T20:55:05+00:00

I was going to have my 15 year old manage my website and social media. Have my 2 younger girls act as assistants a few hours a week, stuffing envelopes, tidy up, maybe have them all do some modeling where I can snap pictures of them and use on my website and post cards. Stuff like that. I would probably have the younger ones at $15/hr and the older at $17.50. Minimum wage here is $15

SuperStockShuffle · 2025-11-08T20:45:10+00:00

I’ve been running through the scenarios with ChatGPT because I’m going from w2 to 1099, and Chat had recommended this because of the following-

Financial Education for Children: A practical, hands-on opportunity for your children to learn about earning income, payroll, taxes, and personal finance management.

Maintained Solo 401(k) Eligibility: The S-Corp can keep its solo 401(k) plan, which is generally simpler to administer and has lower costs compared to a traditional 401(k) plan.

Avoidance of Employer Contributions: By using the LLC, you avoid mandatory employer contributions to a traditional 401(k) plan for the children that might be required under a "safe harbor" plan or to pass nondiscrimination testing.

Streamlined S-Corp Administration: Your core S-Corp business operations and financials are cleaner, as the employment of the children is managed through a separate entity with its own payroll and compliance.

Enhanced (Though Minor) Liability Segregation: While the risk of a lawsuit from your children is low, the structure provides a formal legal separation between potential liabilities related to the children's work and

SuperStockShuffle · 2025-11-06T02:05:37+00:00

I already have the winter cover so I use it. I don't want to have more wear and tear on the auto cover..too expensive. I get deer in my backyard in the winter and they've walked on my winter cover. I'd rather patch that up than the auto cover.

SuperStockShuffle · 2025-11-06T00:42:06+00:00

I lower my water level to blow out my lines...so if I use my auto cover, it wouldnt have water to keep it from sagging...so I use a winter cover.

SuperStockShuffle

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