Question About Minor Child Employed

[DLSINWEST]

Employing Your Child Under 18 They Are Not Subject To Ss And Medicare Tax....the Tax Book 5-24 It Says Not Subject To Se Tax That Would Mean 1099misc...page 23-7 Says Employee's...the Question Is W'2 Employee Or 1099misc Ind Contractor Is

[taxmandan]

Employing Your Child Under 18 They Are Not Subject To Ss And Medicare Tax....the Tax Book 5-24 It Says Not Subject To Se Tax That Would Mean 1099misc...page 23-7 Says Employee's...the Question Is W'2 Employee Or 1099misc Ind Contractor Is

The child is still a W-2 employee, just doesn't have the FICA withholding. Remember, this is only applicable for sole-proprietors, not LLC, S-Corp. etc.

[gkaiseril]

Wages Just No FICA or Medicare Tax

The child must be under 21 and not employed by a corporation, partnership nor estate, only a parent's Schedule C business or Schedule F Farm. They are paid on a W-2 and have federal, state. and local income tax withheld as needed. There is not FICA or Medicare wages or taxes and not subject to FUTA. See IRS Pub 15, 3. Family Employees page 8 .

[taxmandan]

The child must be under 21 and not employed by a corporation, partnership nor estate, only a parent's Schedule C business or Schedule F Farm. They are paid on a W-2 and have federal, state. and local income tax withheld as needed. There is not FICA or Medicare wages or taxes and not subject to FUTA. See IRS Pub 15, 3. Family Employees page 8 .

The age is 18, for non-farm business anyway, not sure about farms.

[Lion]

H/W Partnerships

And, I think, partnerships where the only partners are the parents of the child, qualify to avoid FICA, also.

Just a thought: if your child intends to become a teacher or any profession not paying into SS, then he might want to get as many quarters as possible into the SS system from his part-time jobs now while in school.

[cpadan]

[QUOTE=Lion;54743]And, I think, partnerships where the only partners are the parents of the child, qualify to avoid FICA,QUOTE]

That is true.

[gkaiseril]

The whole first paragraph:

3. Family Employees

Child employed by parents. Payments for the services of a child under age 18 who works for his or her parent in a trade or business are not subject to social security and Medicare taxes if the trade or business is a sole proprietorship or a [/BOLD partnership in which each partner is a parent of the child.BOLD] If these payments are for work other than in or business, such as domestic work in the parent’s private home, they are not subject to social security and Medicare taxes until the child reaches age 21. However, see Covered services of a child or spouse later. Payments for the services of a child under age 21 who works for his or her parent, whether or not in a trade or business, are not subject to federal unemployment (FUTA) tax. Although not subject to FUTA tax, the wages of a child may be subject to income tax withholding.

If the child is employed by the sole proprietorship of one of the child's parents or a partnership of just the child's parents. Note the wording

http://www.irs.gov/pub/irs-pdf/p15.pdf#page=9