Thinking of hiring your kid at your small business, although the word nepotism is usually associated with a lot of negativity there are some really good reasons why you should actually hire your kid to work at your business.
- It gives your kid experience
Having your child work at a corporate environment at an early age can be a really great way for them to get some experience in the corporate field. This will also help build up his/her resume as well. It’s also a great experience for them to work because working helps push them to work harder in the field.
- It may help your child’s talent
Children when growing up often are unaware of what talents they may or may not have, for example my child had a talent for writing and he got hired at ToyReviewExperts and got paid quite a lot of money for it. A job can help your child discover the talents that they may have and have not discovered as of yet and they can definitely discover several more talents to latch onto in their later careers.
- Tax-free income
Children’s incomes are not reported to Tax authorities; therefore, they are tax exempt and keep money within the family. Payments for a sub-18-year-old child are exempt from FICA and sub-21-year-old children are exempt from FUTA.
- Retirement savings
Start early and build up! There is no actual age requirement for the IRA, so children can start very early and get their savings up while they work. Unfortunately, there is a contributions limit of 5,500$. Meaning you can’t put more than 5,500$ into your IRA at one time, this is a great way to start your child on learning financial literacy at an early age.