Payroll - Employing your child - Ask and Answer Questions https://aipb.org/community/bookkeeping-general/payroll-employing-your-child/ American Institute of Professional Bookkeepers Discussion Board en-US Wed, 17 Jun 2026 01:02:49 +0000 wpForo 60 Payroll - Employing your child https://aipb.org/community/bookkeeping-general/payroll-employing-your-child/#post-3905 Fri, 13 Jan 2023 18:48:47 +0000 Situation: A sole proprietor does not have any employees but hires his child (age below 18) to help in his trade or business.  Pub15 says the pay is not subject to FICA/Medicare taxes nor FUTA.  From my searches, some tax advisors recommend not to report the pay thru a 1099 but filing a W-2 is recommended so that the child will have a support for contributing into a ROTH.  

Conclusion/Question: 

So from that, I guess the filing of W2/W3 is necessary but Form 940 is not required, am I correct?

Do we need to file Form 941 even if the only employee he has is his child and there are no withholding taxes and medicare taxes to report?

I hope you hear your inputs.

Thanks,  --LTan

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