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Showing posts with the label Payroll

Day 7 – How to Hire Your Kid Legally — And Save Taxes

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  Day 7 – How to Hire Your Kid Legally — And Save Taxes Hiring your child might sound like a sentimental idea, but it’s actually a strategic tax-saving move —if done right. The IRS allows business owners to hire their minor children under certain conditions, offering both tax deductions for your business and income tax benefits for your child . Here's how to make it work legally and efficiently. ✅ Why Hire Your Child? 1. Your Business Gets a Deduction Wages paid to your child are a legitimate business expense. That means your business income (and tax liability) goes down. 2. Your Child May Owe Zero Taxes As of 2025, a child can earn up to $14,600 (the standard deduction) without paying any federal income tax— as long as it’s earned income (i.e., wages, not gifts or allowances). 3. No Payroll Taxes for Some Businesses If your business is a sole proprietorship or a partnership where both partners are the child’s parents , and your child is under 18 , then: No Social S...
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Do I Need to Pay Myself a Salary as a Business Owner?

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  πŸ’Ό Do I Need to Pay Myself a Salary as a Business Owner? One of the most common questions solo entrepreneurs ask once their business starts generating consistent income is: "Should I pay myself a salary?" The answer depends on your business structure—and choosing the right approach can impact both your tax liability and legal compliance . πŸ‘€ If You're a Sole Proprietor or Single-Member LLC Good news: You don’t need to pay yourself a formal salary. In these structures, the IRS treats you and your business as the same entity. This means: You take an owner’s draw , not a salary. All profits flow through to your personal tax return via Schedule C . You're not considered an employee, so no payroll taxes or W-2s are involved. But remember: You’re still responsible for self-employment tax (which covers Social Security and Medicare), so setting aside about 25–30% of profits for taxes is a smart move. 🏒 If You're an S Corporation Here’s where thi...
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Hiring a Remote Employee in Georgia: What You Must Know About Payroll Compliance

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  πŸ“Œ Hiring a Remote Employee in Georgia: What You Must Know About Payroll Compliance As remote work becomes more common, many small business owners find themselves navigating complex payroll requirements across state lines. If you hire a remote employee who lives and works in Georgia , there are critical compliance steps you must take — even if your business is located in another state. In this post, we'll walk through exactly what you need to do — and when foreign business registration might be required. πŸ“ The Scenario You’ve just hired your first remote employee who lives in Georgia . What does that mean for payroll taxes? ✅ Step 1: Register for Georgia State Payroll Taxes Even though your business is not located in Georgia, you are still responsible for complying with Georgia’s tax laws if your employee performs work there . That means: 1. Georgia Income Tax Withholding You must: Register for a Georgia Withholding Tax Account through the Georgia Tax Center Wit...
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