As the owner of an S-Corp, you have the option of having a family member work for you. There are a wide variety of advantages that come along with employing your spouse or child.
Hiring and paying your spouse may increase potential fringe benefits and provide tax advantages. You also have the option of hiring your children to perform various duties for the company, like handling the company’s social media accounts. Paying your children can decrease the family taxes, increase deductible business expenses, and help start a retirement plan for your children. For more information about the benefits of hiring your family members, visit our blog
In order to maximize your savings, it’s important to make sure the pros of hiring your family members outweigh the cons. When employing a family member, you must treat your employed family members the same as you treat other employees: submit a W-4 Employee’s Withholding Certificate on their behalf, **pay them overtime at the same rate as other employees, the same sick pay, holiday pay, vacation pay, and paid time off as to all other employees.
* The information provided does not, and is not, intended to constitute legal or tax advice, and should not be relied on as such; all information, content, and materials are for informational purposes only. Before making any decisions consult your attorney or tax advisor.