Hire your kids.
Nail the paperwork. Fund their Roth IRA.
We handle the paperwork.
Create worksheets for professional review.
You pay your kids reasonable wages for real work in your business. Eligible wages may be deductible as a business expense.1 At a 32% marginal rate, a $5,000 deduction could reduce federal income tax by $1,600, before other effects. Some parent-owned sole proprietorships and qualifying parent-only partnerships may also qualify for a FICA exemption for a child under 18.2
If wages are the child's only income, the dependent standard-deduction formula may offset federal taxable income up to its annual maximum.3 Other income, payroll taxes, state law, and filing circumstances can change the result.
Qualifying compensation may support a Roth IRA contribution.4 A $5,000 annual contribution starting at age 10 could grow to over $1.3 million by 65 at a steady 7% return; returns are not guaranteed and earnings are tax-free only on qualified distributions.
See the potential numbers.
Assumes wages are the child's only income, applies a simplified 10% rate above the $16,100 single-filer maximum, and omits state and other taxes. A parent sole proprietor, parent-owned disregarded single-member LLC, or parents-only partnership may qualify for the under-18 FICA exception and under-21 FUTA exception. Confirm every requirement. Roth projection assumes 7% annual growth. State taxes not included.
The IRS
wants proof
Hiring your kids is completely legal.
But if you get audited, you need documentation. Employment agreements. Time logs. Tax forms.
Without them? The IRS disallows the contributions and charges you penalties.
Most parents learn about this and get excited. Then they see the paperwork and just give up.
Internal Revenue Service
Includes penalties & interest
Reason for adjustment
Roth IRA contributions disallowed due to insufficient documentation.
- No employment agreement on file
- Missing work logs / timesheets
- Payments not properly documented
Employ your kids the right way.
Simple to set up. Easy to use. Audit-ready by design.
Hire your kids in minutes
Set up your kids as business employees. Pick from 100+ tasks. Built-in rate guidance. We generate the contracts.
Log work and payments
You handle the money.
We handle the documentation.
- Automatic server timestamps
- Complete activity history
- Separate household vs business work
- Optional photo proof
- Works with any payment method, any brokerage
Year-End Tax Packet
One click. Everything organized. Every document timestamped and traceable.
Download anytime. Your data is stored securely, so you can regenerate documents whenever you need them.
Organize records for tax review
Deduct their wages as a business expense. If you are a sole prop, disregarded LLC, or parents-only partnership, wages to a child under 18 can also skip the 15.3% FICA (under 21 for FUTA). Corporations do not qualify.
- Wages become a deductible business expense
- FICA exempt (sole props, LLCs, spousal partnerships)
- Wage Expense Summary for your tax preparer
Simple pricing.
Pays for itself in tax savings. No hidden fees.
30-day money-back guarantee.
Pro
Employ your kids through your business. Backed by decades of IRS guidance and tax court precedent.
- Log household and business work
- Sign employment contracts online
- Year-End Tax Packet export
- W-2 worksheet data
- Wage expense summary for deductions
- Track payroll tax exemptions
- Timesheets & work logs
- Roth contribution tracking
- Priority support
- Unlimited children
Looking for household employment only? See the Home plan ($299/year).
Questions? hello@jerryfeng.com