Students and taxes
 

I am considering starting a small business where I will be selling un-wanted and out dated inventory.

One contact I have says he has to 1099 me, another says he will not. (not sure why the difference)

Question is, should I set this up in my son's name? He is 15.

We will be bringing in about 15K a year and I want to use the money to fund his college and pay for some hunting and fishing.

What are my down sides? He has to be in a lower tax bracket than me for sure.

Any advice or input would be helpful

Oh, can he be a priciple in a LLC?

PM Casey, I'm sure he can steer you in the right direction...... Sorry Boss! :D

Not a lawyer nor did i sleep in a holiday in express last night, But being he is not of legal age and can not legally sign contracts ,i don't see how he can be principle in an LLC.

didn't even think of that EMAN........you are correct sir

Not sure if it is leagal but i worked for my dad when I was his age and got paid. So just put the business in your name and pay him most of the profit.

Child labor laws do not exist if it's your kid. I worked in my dads restaurants when I was in the 3rd grade . As far a 1099's , only 1/2 of my contracts 1099 my business when I do work for them . I still claim it all . The only reason it would benefit you if they didn't 1099 you was if they pay u cash and that cash didn't see the bank. Otherwise it's on paper so it's smart to claim it .now if you set up him as an employee with a retirement fund that wouldn't get penalized if taken out early for school you may be able to avoid some taxes by putting the majority of his "paycheck" in the retirement acct. not sure of the specifics though , I'd ask Casey or your tax accountant