Category: Income Shifting

  • The “Kiddie Tax” Hurts Families More Than Ever

    The “Kiddie Tax” Hurts Families More Than Ever

    Years ago, Congress enacted the “kiddie tax” rules to prevent parents and grandparents in high tax brackets from shifting income (especially from investments) to children in lower tax brackets. And while the tax caused some families pain in the past, it’s worse today. That’s because the Tax Cuts and Jobs Act (TCJA) made changes to…

  • Hire Your Children This Summer:  Everyone Wins

    Hire Your Children This Summer: Everyone Wins

    If you’re a business owner and you hire your children (or grandchildren) this summer, you can obtain tax breaks and other non-tax benefits. The kids can gain on-the-job experience, save for college and learn how to manage money. And you may be able to: Shift your high-taxed income into tax-free or low-taxed income, Realize payroll…

  • Why the “Kiddie Tax” is More Dangerous than Ever Before

    Why the “Kiddie Tax” is More Dangerous than Ever Before

    Once upon a time, some parents and grandparents would attempt to save tax by putting investments in the names of their young children or grandchildren in lower income tax brackets. To discourage such strategies, Congress created the “kiddie” tax back in 1986. Since then, this tax has gradually become more far-reaching. Now, under the Tax…