Hi All, My father is opening his third business and has asked me to take on the accounting for it (yes, I’m qualified) as he won’t be as hands on in business #3 as he is in #1 and #2.
Since this will be a second source of income for me that I don’t need he asked me to research if there is a way to pay me tax exempt. Ie, if I open a 501-3c or something similar and get paid through that can I set the money aside for my child’s college fund (I’m not interested in setting up a 529 account)
I’m wondering if there’s a separate entity I can establish so I’m not an employee but rather a contractor to be smart with my obligations.
I’m not sure how old your child is, but if your father pays you via 1099, technically you’re self employed. You can then hire your child to work for your business, and if your child earns $12,950 or less they are not required to file a tax return.
https://www.irs.gov/businesses/small-businesses-self-employed/family-help