I started doing this for my son when he was 9 (currently almost 11). My CPA makes me keep track of hours he works in the office and what his duties were. He has advised to only do $2k each year so but this is giving him an amazing start to tax free money in retirement! We plan to do the same with my daughter. She is currently 5 and the CPA advised that we probably can’t get $2k worth of “work” out of her yet.
Great feedback! We do this as well and have kept it to around $600 per year. My daughter is getting older so she’s helping more and more with my business lately. It’s easier to increase her pay with the real work she’s doing for my small business!
So do the kids have to file for income tax? How about self employment tax? How is this done and and why is this done since they don’t have to file for taxes since they are under the threshold of 12k for the year?
This was really great content, and something I have been researching to learn more about (to no avail). I've posted this question here a couple months ago and I knew one day I would see an in-depth discussion and analysis of how a custodial Roth IRA for kids can be done. All my remaining questions have been answered. Thanks again for another great video!!
Thank you for expressing your interest in the topic! Dee is a knowledgeable CPA and mother who is putting this advice into action. So glad to be able to feature her!
Wow, such great content! This is exactly what I've been searching for! I have a 5 month old, and I want to add her to my company's payroll as a model. My only question is: do I open a regular bank account for her, where her salary will be deposited, and then transfer her salary into the Roth IRA? Or is there something else I need to do?
Can you list ways we can hire our young kids (under the age of 14)? For example, parents who are W2 employees and not self employed. I am W2 employee so I can't hire someone
From my understanding when you hire a child that is your child as long as you pay him under or her under the standard deduction turn on they do not have to file taxes. But she's not stating that she's saying that they do have to file taxes which I don't believe is correct
How about for a home childcare. My gf runs a in home childcare business she’s the only employee how can we pay are kids for all the things they help with. They do dishes the childcare children use, clean the toys they use, take out the trash they create, help serve meals to the children, clean the table they use, sweep the floor. A lot seem like they are chores but the job isn’t created by the household members atleast not all of it.
Newborns would need to have an earned income to participate in a Roth IRA. I’d suggest looking into a 529 college savings account (for college) OR a kids brokerage account (UTMA) (for a future home down payment)!
Nearly impossible from what I understand. Unless they are toddler actors or models. If you're looking to invest for your toddler, consider a 529 College Savings Account or a UTMA. More details here: ruclips.net/video/Z6eW6z7-wuk/видео.htmlsi=EPKA1h_EA-QW4Nqi
I've found it difficult to pay directly to the Roth IRA. Instead, both of my kids have a checking account and I created a direct transfer from that checking account to their Roth IRA. I'd recommend checking out Dee's course in the pinned comment above as she goes through the details.
Check out the resources from Dee from the Kids Money Academy here: www.marriagekidsandmoney.com/kidsmoneyacademy (affiliate link)
I started doing this for my son when he was 9 (currently almost 11). My CPA makes me keep track of hours he works in the office and what his duties were. He has advised to only do $2k each year so but this is giving him an amazing start to tax free money in retirement!
We plan to do the same with my daughter. She is currently 5 and the CPA advised that we probably can’t get $2k worth of “work” out of her yet.
Great feedback! We do this as well and have kept it to around $600 per year.
My daughter is getting older so she’s helping more and more with my business lately. It’s easier to increase her pay with the real work she’s doing for my small business!
So do the kids have to file for income tax? How about self employment tax? How is this done and and why is this done since they don’t have to file for taxes since they are under the threshold of 12k for the year?
This was really great content, and something I have been researching to learn more about (to no avail). I've posted this question here a couple months ago and I knew one day I would see an in-depth discussion and analysis of how a custodial Roth IRA for kids can be done. All my remaining questions have been answered. Thanks again for another great video!!
Thank you for expressing your interest in the topic! Dee is a knowledgeable CPA and mother who is putting this advice into action.
So glad to be able to feature her!
Wow, such great content! This is exactly what I've been searching for! I have a 5 month old, and I want to add her to my company's payroll as a model. My only question is: do I open a regular bank account for her, where her salary will be deposited, and then transfer her salary into the Roth IRA? Or is there something else I need to do?
Great question, please share your answer if you receive it. I would like to know myself.
Can you list ways we can hire our young kids (under the age of 14)? For example, parents who are W2 employees and not self employed. I am W2 employee so I can't hire someone
From my understanding when you hire a child that is your child as long as you pay him under or her under the standard deduction turn on they do not have to file taxes. But she's not stating that she's saying that they do have to file taxes which I don't believe is correct
That's a great question! I'd check in with your accountant or CPA.
My accountant recommended that I file taxes for my kids who work for my business.
How about for a home childcare. My gf runs a in home childcare business she’s the only employee how can we pay are kids for all the things they help with. They do dishes the childcare children use, clean the toys they use, take out the trash they create, help serve meals to the children, clean the table they use, sweep the floor. A lot seem like they are chores but the job isn’t created by the household members atleast not all of it.
Do I have to open up a bank account for their paychecks before applying it to their Roth IRAs or is there a more direct route?
How about for new borns?
Newborns would need to have an earned income to participate in a Roth IRA.
I’d suggest looking into a 529 college savings account (for college) OR a kids brokerage account (UTMA) (for a future home down payment)!
as models
If hiring my kids in my business, do I put them in my payroll (i.e. complete all the hiring documents necessary)?
Check your state if u have business lisence there is an option there. Click home page “ hire minor”
How does your child earn income if you are not a business owner and they are toddlers?
Nearly impossible from what I understand. Unless they are toddler actors or models.
If you're looking to invest for your toddler, consider a 529 College Savings Account or a UTMA.
More details here: ruclips.net/video/Z6eW6z7-wuk/видео.htmlsi=EPKA1h_EA-QW4Nqi
Can i pay my kids on my business account direct to his roth ira kids account? I dont need to make w2 ?
I've found it difficult to pay directly to the Roth IRA. Instead, both of my kids have a checking account and I created a direct transfer from that checking account to their Roth IRA.
I'd recommend checking out Dee's course in the pinned comment above as she goes through the details.
Which company do you highly recommend to start a Roth IRA for kids?
Fediltiy