Kids Payroll Blog

How We Pay Our 11-Year-Old for Real Work Every Week (Our Actual Workflow)

Every article about paying your kids explains the tax benefits. Nobody shows you what it looks like week to week without it falling apart. This is that article.

April 2026

Reasonable Compensation for Kids on Payroll: IRS Rules, Rates, and Real Estate Examples (2026)

What counts as reasonable compensation when paying your kids? IRS guidelines, age-based pay rates, real estate task examples, and how to avoid audit red flags for family employment.

14 min read

Do I Still Get the Child Tax Credit If I Hire My Kid?

Yes, you keep the Child Tax Credit even if your child works for your business. Plus, the deduction can actually help you stay under phaseout thresholds.

6 min read

What Happens When Your Child Employee Turns 18? (Everything That Changes)

When your child turns 18, FICA exemptions end but the strategy evolves. Here's what changes, what stays, and how to adapt your family employment setup.

Can You Still Claim Your Child as a Dependent If They Work for You?

Yes, hiring your child doesn't affect their dependent status. Learn how the IRS support test works and why you keep the Child Tax Credit too.

7 min read

My CPA Says I Can't Hire My Kids. Are They Wrong?

Many CPAs give incomplete advice on hiring your children. Here's why they say no, when they're wrong, and how to find a tax pro who understands family employment.

Is Paying Your Kids From Your Business Legal? Yes -- Here's the Proof

Yes, paying your kids through your business is legal. IRC §3121(b)(3)(A) exempts wages from FICA. Here's the proof from the IRS, Tax Court, and the tax code.

W-2 vs 1099: How Should You Pay Your Child?

W-2 is almost always the right choice for paying your child under 18. Here's why issuing a 1099 costs you thousands in unnecessary self-employment tax.

How We've Been Paying Our Daughter as an Employee Since She Was 5 (And Why Every Business-Owner Parent Should Consider It)

Here's the exact 6-step process we use to legally pay our kids, reduce our taxes, and fund a Roth IRA — all while teaching them real-world skills.

Getting Started

How to Open a Bank Account for Your Child to Receive Business Wages (2026)

Paying your child through your business requires a bank account in their name. Here's how to set one up, even when banks say no because of your child's age.

9 min read

Wealth Building

How to Build Your Child's Credit Score Before They Turn 18

Your child can have a 750+ credit score by age 18 using the authorized user strategy. Here's which banks work, age requirements, and step-by-step setup.

Can I Deduct My Child's Wages as a Business Expense? (2026)

Yes, wages paid to your child for legitimate business work are tax-deductible. Here's how business owners claim the deduction and what the IRS requires.

How to Set Up a Family Management Company to Pay Your Kids (2026)

S Corp owners can still pay their kids tax-free using a Family Management Company. Here's the step-by-step setup guide from a real estate investor who's done it.

FICA Exemption for Minor Children: How Business Owners Save on Payroll Taxes

Business owners can skip FICA taxes when paying children under 18. Here's exactly how the exemption works, who qualifies, and how much you can save in 2026.

Entrepreneurship

How to Help Your Child Start a Business Before Age 18

Kid entrepreneurs aren't just for YouTube. Here's how to help your child start a real business, earn Roth IRA income, and learn skills school won't teach.

13 min read

What Happens If the IRS Audits Your Kids' Payroll? (2026)

Worried about an IRS audit on your child's wages? Here's what triggers scrutiny, what they look for, and how to make sure your family is protected.

Paying Your Kids vs. Giving an Allowance: Tax Differences for Business Owners

An allowance costs you after-tax dollars. Paying your kids through your business is tax-deductible. Here's why business owners should make the switch.

Wealth Building

Roth IRA vs UGMA for Kids: Which Is Better? A Business Owner's Guide (2026)

Business owners who pay their kids can fund both Roth IRAs and UGMA accounts. Here's when to use each, the tax differences, and how they work together.

Do I Need to Run Payroll for My Child? Yes -- Here's Why (2026)

Paying your child cash under the table won't hold up with the IRS. Here's why proper payroll matters and how to do it without the hassle.

Sole Prop vs S Corp: Which Is Better for Paying Your Kids? (2026)

Sole proprietors get automatic payroll tax exemptions when hiring their kids. S Corp owners need an extra step. Here's how both structures work in 2026.

9 min read

Federal vs. State Child Labor Laws: What Family Business Owners Must Know (2026)

Federal law says you can hire your kids. Your state might disagree. Learn how to navigate conflicting laws and stay compliant.

14 min read

Hiring Your Kids: What Records to Keep for the IRS (2026)

Protect your family business deduction with proper documentation. Here's what records to keep when employing your children.

Job Ideas

What Jobs Can I Pay My Kids For? Age-by-Age Guide (2026)

Discover legitimate jobs you can pay your kids to do in your business, organized by age. IRS-compliant ideas for every stage.

7 min read

Kids Payroll Checklist: W-4, I-9, and Everything You Need to File (2026)

The complete paperwork checklist for hiring your child: W-4, I-9, quarterly filings, W-2 requirements, and record-keeping essentials.

Comparison

Kids Payroll vs. Traditional Payroll Software: Which Is Right for Hiring Your Kids?

Compare Kids Payroll to Gusto, QuickBooks & Wave for tracking your children's business work. See why purpose-built beats general payroll.

Job Ideas

50+ Legitimate Tasks You Can Pay Your Kids to Do in Your Business (By Age)

Discover 50+ IRS-compliant tasks you can pay your kids to do, organized by age from 5 to 17. Real examples and reasonable pay rates included.

How Much Can I Pay My Child Tax-Free in 2026?

In 2026, you can pay your child up to $16,100 tax-free and potentially avoid payroll taxes too. Here's exactly how the math works.

6 min read

How to Pay Your Kids Through Your LLC (2026 Guide)

Learn how to legally pay your children through your LLC, save on taxes, and build their financial future. Step-by-step guide for business owners.

How Much Should I Pay My Child? Reasonable Wage Guide (2026)

The IRS requires reasonable compensation when paying your kids. See real hourly rates by task and age, plus documentation tips.

Wealth Building

Roth IRA for Kids: Rules, Limits & How to Start (2026)

Yes, kids can have a Roth IRA! Learn the rules, contribution limits, and how to start building tax-free wealth for your child's future.

S Corp Owner? Here's How to Still Pay Your Kids Tax-Free (2026)

The Family Management Company strategy lets S Corp owners avoid FICA taxes when hiring their children. Step-by-step setup guide.

State-by-State Guide: Child Labor Laws for Family Businesses (2026)

Work permits, age minimums, and hour restrictions vary dramatically by state. Complete guide covering CA, TX, FL, NY, and more.