In an April 10, 2000 article by TMF AnnC concering Roth IRA's for kids, she stated that children who work for their parents' business are exempt from self employment tax. Either you or she mistyped. All employees are exempt from self-employment tax. They pay only Social Security and Medicare. The self-employed pay self-employment tax, which is the equivalent of SS and M'care. (Publication 533)Children under 18 working in a parent's business as employees are exempt from Social Security and Medicare. (Publication 15)IRA contributions can exceed your taxable compensation. "Taxable compensation" includes wages exempt from SS and M'care. (Publication 590)Phil MartiVITA Volunteer
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