@Coolkids007 from speaking to professionals, it’s good to have a log. Date, chores, how much pay per hour or how much pay for project.
From what I gather, single filers who make less than $12,400 of earned income per year are not required to report their taxes. If you pay your child $1000 or $100 for doing chores in your household, are you taxing them social security and Medicare? I can’t see a case where the answer is yes. Then are you supposed to write them a 1099? Probably not. It’s straight cash. But it’s still considered earned income for the child. Does the child report it if they want to contribute $1000 or $100 to their Roth IRA? Colleen is saying that the child has to report their taxes if they want to contribute that amount to their Roth IRA. But where does it say that earned income, paid in cash, not in a 1099 that is reported, doesn’t count toward Roth IRA contributions?
