I have a home business and hire my minor kid (age 14). Do I still need to file form 941 because I do not need to withhold any medicare or SSA tax for minors?

[CarolynM]

No, you do not need to file form 941 if your minor child is your only employee. 

For more information, follow this link: https://www.irs.gov/forms-pubs/about-form-941

[LTan]

Hello CarolynM, 

Thanks for your response to the question of filing 941.

But would you please specifically point out where in the Form 941 instructions actually say that you don't have to file a 941 if your only employee is your child ?

Thanks for your help.

--LTan

[DawnC]

Generally, any person or business that pays wages to an employee must file a Form 941 each quarter, and must continue to do so even if there are no employees during some of the quarters. The only exceptions to this filing requirement are for seasonal employers who don’t pay employee wages during one or more quarters, employers of household employees and employers of agricultural employees.  See the link to determine if your child is considered a household employee.

One of the advantages of operating your own business is hiring family members. However, employment tax requirements for family employees may vary from those that apply to other employees.    Your child can earn up to $12,950 (in 2022) tax-free.  

Employment Taxes for Children Employed by their Parents

Payments for the services of a child under age 18 aren't subject to Social Security and Medicare taxes, if the business is a sole proprietorship or a partnership in which each partner is a parent of the child. Payments to a child under age 21 aren't subject to FUTA.  Payments are subject to income tax withholding, regardless of the child's age.

Payments for the services of a child are subject to income tax withholding as well as Social Security, Medicare and FUTA taxes if they work for:

• A corporation, even if it's controlled by the child's parent, or
• A partnership, even if the child's parent is a partner, unless each partner is a parent of the child.

@LTan

[AmeliesUncle]

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@LTan wrote:

But would you please specifically point out where in the Form 941 instructions actually say that you don't have to file a 941 if your only employee is your child ?

---

Who Must File Form 941?

If you pay wages subject to federal income tax withholding or social security and Medicare taxes, you must file Form 941 quarterly to report the following amounts.

Are the wages you paid subject to federal income tax withholding or social security and Medicare taxes?  If not, Form 941 is not required.

[LTan]

Hello DawnC,

Thank you for your response.   It's very helpful.

But what if the only employee is the child who is below 18 and there are no FED taxes since the child is still a dependent and will surely not be subject to tax, and there are no FICA/Med Taxes to remit since the pay is not subject to ER/EE taxes?

Is the owner still required to file Form 941 or if seasonal, Form 944?

Thanks,

LTan

[AbrahamT]

The answer is NO, if the employer is a sole proprietor or partnership where the partner is the parent.  that, with this link: https://www.irs.gov/newsroom/tax-treatment-for-family-members-working-in-the-family-business#:~:text....

It says: "Child employed by parents. Payments for the services of a child under age 18 aren't subject to Social Security and Medicare taxes, if the business is a sole proprietorship or a partnership in which each partner is a parent of the child. Payments to a child under age 21 aren't subject to FUTA.

The bottom line is that if the wages aren't subject to tax then no form is required. 

[Pamela Roller MSA EA]

The link you gave states "Payments are subject to income tax withholding, regardless of the child's age." I so not see an exception to filing form 941 unless you are a seasonal employer. Logically you must file W-2's so you would need to file the 941s to balance.

This was from the link: "Child employed by parents. Payments for the services of a child under age 18 aren't subject to Social Security and Medicare taxes, if the business is a sole proprietorship or a partnership in which each partner is a parent of the child. Payments to a child under age 21 aren't subject to FUTA. Payments are subject to income tax withholding, regardless of the child's age.

Payments for the services of a child are subject to income tax withholding as well as Social Security, Medicare and FUTA taxes if they work for:

• A corporation, even if it's controlled by the child's parent, or
• A partnership, even if the child's parent is a partner, unless each partner is a parent of the child."

I hope this helps.

[PII Removed], MSA, EA