Best Bookkeeping Services in Chesapeake, VA

Hiring Family Members in Your Business. Got your kids on payroll yet? When you hire your under-age-18 child, you shift taxable income from you to your child. Why does hiring family members matter? Because if you're single with taxable income of $40,526 or higher - or married with $81,050 or higher - you're in the 22% (or higher!) federal tax bracket. At the same time, your child is in the 0% tax bracket on the first $12,550 they earn. Think of it this way: $12,550 deduction for you, and no taxable income for your child. Wait, it gets better, if your business is structured tax-wise as a sole proprietorship or husband & wife partnership. Then you're also exempt from payroll taxes. on your under age 18 children. It's a beautiful tax saving strategy, plus it supports college savings using 'pre-tax' dollars. It's important, however, you implement this strategy the right way, and avoid potential IRS trouble/penalty. Contact us for help.