My kids have always made money doing small jobs like mowing lawns or babysitting. Up until 2022, the income was minimal so I didn’t worry about reporting it to the IRS. In 2022, my two eldest had jobs, made thousands of dollars, and received W-2’s. The IRS knew they made money so what did I have to do?
Long story short, I didn’t include their income with mine and my spouse’s. I filed separate tax returns for them even though they weren’t required to file…mainly because I like filing taxes. This was something I did for fun. Also, one of the kids will receive a $20 refund. Also, if you use TaxAct, it is 100% free to file their taxes. Fun and Free…doesn’t get any better.
This is a really short post. In the video, I get into the technicalities of it. When are you actually required to file tax returns for your kids? How can you save a lot of money on taxes when you own your own business and pay your kids as employees? Enjoy!
- IRS Guidance: https://www.irs.gov/publications/p501
- Employing your Kids: https://keithjones.cpa/hire-your-kids
- TaxAct Tax Estimator: https://www.taxact.com/tools/tax-calculator