What about single member LLC companies? Immaterial ... you have employees you must file the appropriate payroll tax forms timely.
Are the children subject to taxes? Read the other answers to this post ... you must file the W-2 even if the child is not subject to FICA or withholdings.
Also, how would the 941 get filled up if there are regular nonfamily employees and children employees in the small business? If you already are filing payroll tax reports for other employees then you will just add the child as another employee... nothing is different on the payroll tax forms. Read the form instructions or seek help from a local payroll company to get educated if needed.
