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I am self-employed. How can I reflect hiring my child as w-2 employee?

 
3 Replies
Phillip1
New Member

I am self-employed. How can I reflect hiring my child as w-2 employee?

If there were wages paid to your child, you can deduct those wages as one of your business expenses in the Business Income and Expense section of TurboTax self-employed (there should be a line labeled Wages or payroll). This is all you need to do in regards to your child's wages on the tax return.

There are some rules to keep in mind if your are paying your child a wage in your business:

  • Your child needs to be performing a useful function to your business. You can't pay your child to do household chores.
  • You don't need to withhold social security and medicare tax if your business is a sole proprietorship or a partnership where both parents make up all the partners in the business for wages to your children who are under 18.
  • You need to provide your children with W-2s.
  • You must maintain documentation to prove the hourly rate paid, the number of hours worked, and the amount earned during each payroll period in the event of an audit by the IRS.

I am self-employed. How can I reflect hiring my child as w-2 employee?

1/ Regarding yours: "there should be a line labeled Wages or payroll" - I see no such line.  The only one more or less relevant is Inventory / Cost of Goods Sold.  2/ Do I really need EIN if I pay 6000 USD per Year?  (I am not allowed to input my - employer's SSN when I try to make W-2 for my child)

I am self-employed. How can I reflect hiring my child as w-2 employee?

I repeat the question:  there is NO Wages or payroll. The only options available

Inventory / Cost of Goods Sold
  Inventory and Cost of Goods Sold
Business Expenses
  Every day expenses conducting business
  Business Vehicle Expense
  Other Common Business Expenses
  Home Office Expense


I have NO inventory or COGS, I just need to reflect salary paid to my household member who assisted me in consulting services. Where and how can  should I enter this?
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