Children can be great tax benefits. Not only do we get a personal exemption for each one of them, we can involve them in our business. When we get them into our business, we can pay our children and deduct their salary. Frequently, children have a lower tax bracket than their parents, so moving money to their tax brackets is highly desirable.

In this regard, Willy asks the following question:

Q: What are some of the strategies I can use for marketing my kids into my business? How do I make those tax deductible?

A: Let me answer the second question first. Any time we pay someone for performing a service for our business, the payment will be deductible so long as the service and payment meet three tests. They must be ordinary (normal) in your business. They must be necessary (they help us make a profit). And, they must have a business purpose.

There are many ways to get your children involved in your business. They can do bookkeeping for you. I did this for my father’s business throughout high school. They can do cleanup and maintenance on your real estate investment properties. Or, if you have a business that emphasizes families and/or children, you can use them as models for your brochures and website.

All of these ideas and more are contained in our course entitled, “Getting Your Children Into the Game.” You can find it at www.provisionwealth.com/products. Just click on the School of Tax Strategy and you can have this powerful tool for your business.

Warmest regards,

Tom