Discussion:Employ Child
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Discussion Forum Index --> Tax Questions --> Employ Child
| 4 September 2007 | |
| Client is adamant about paying her child wages from her S-Corp saying that her 18 month old child is providing services to her company.
What services...walking paper between employee desks, putting stuff in the garbage, client relations, etc..... What age must a child be to justify wages? I read somewhere, can't remember where, that there was an IRS case that required a child to be at least 7 years old to justify expense deduciton, otherwise you can do it but it is non-deductible. Thanks - | |
Donniecastleman (talk|edits) said: | 4 September 2007 |
| 18 month old child? Oh come on, this lady found some crap on the internet somewhere about how to save $10 a year by paying her infant, I'm not buying it because there would have to be a legitimate reason to pay your child, and it doesn't seem to be modeling. Tell her you'll knock $10 a year off her tax return preparation fees not to ever bother you again with bull$hit like this. | |
| 4 September 2007 | |
| What about child labor laws in her state does she not understand???? | |
| September 4, 2007 | |
| Child labor laws usually don't apply to family biz, but to IRS, you'd have to able to provide a job description, time records, etc. as for any other employee. She's pushing it. I've had young kids on, yes, they can empty trash and sharpen pencils, dump the money into a custodial account, etc. | |
| 4 September 2007 | |
| You should suggest that this client find a preparer with lower ethical standards than yours. | |
| 4 September 2007 | |
| Sometimes an accountant has no other choice than to tell a client that something is utterly ridiculous and fraudulent. This is one of those times. I would also advise her that someone might report her to CPS if she is indeed trying to make an 18 month old work (unless the field was modeling, etc.). Yes, children can legitimately provide services, but in this is a toddler. Additionally, this is a corporation so payroll taxes, unemployment, and workers comp would be needed if the child was an employee. | |
| 4 September 2007 | |
| She will get a notice from the SSA saying that she has a young child on payroll and questioning what that kid does. It is called "Social Security Request for Employee Information". It includes this statement, "We may give this information to the Internal Revenue Service for tax administration purposes or to the Department of Justice for investigating and prosecuting violations of the Social Security Act."
I would tell my client that I cannot be part of this arrangement. End of discussion. | |
Death&Taxes (talk|edits) said: | 4 September 2007 |
Any chance the child is a model for diaper or toilet paper commercials and that is part of Mom's business? We must not rule anything out  .
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| 4 September 2007 | |
| Get the kid to model for the companies advertisement. Models make a lot of money.Maybe the kid will qualify next year and open a Roth IRA! | |
Death&Taxes (talk|edits) said: | 4 September 2007 |
| Obviously I missed something 12 years ago when my office manager would bring her 2-3 month old into the office, set up the playpen in the waiting room and let the child amuse the clients. Then, again, Denise and her baby were not related to me, so I could obtain no benefit, and after tax season, the kid might have filed for unemployment, boosting my rate.
Oh to be a fly on the wall when she became 'adamant.' | |
| 4 September 2007 | |
| My 'Adam Ant' clients include one who wants to write off his timeshare in Cancun since he plans to offer its use to employees, and another who insists his houseboat is necessary because he might bid a job someday that would require a boat. | |
Death&Taxes (talk|edits) said: | 4 September 2007 |
| Where is Kevin when you really need him? | |
TheTinCook (talk|edits) said: | 4 September 2007 |
| I think he went off to the pet store. | |
| September 4, 2007 | |
| DZCPA, Does modeling include family photos on my credenza? | |
| 5 September 2007 | |
| No. Use in printed advertisment. Family photos of Nicolas Cage not allowed. | |
Michaelstar (talk|edits) said: | 5 September 2007 |
| Agree - time to walk away from this client. If you agree to this - wait until the next chit chat party circle where they "learn" all of the "other" things one is allowed to do........ | |
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