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My wife is a piano teacher. She makes about $12,000 a year and files Schedule C each year. Unlike most Fools, we have 4 teenagers, 2 in college and 2 in high school. Our joint income of about $125,000 exceeds the limits for tax credits under the current tax credit plans, our college kids don't qualify for any scholarships or grants, and it costs us about $30K a year ($45K next year) to meet college expenses. We have saved for their education and will survive, but we are looking for all possible ways to reduce our tax burden and keep paying for college, without having to take out any loans. Can my wife (with my help or from her savings)legally employ our children at $4000 each and reflect a business loss for the year? What are the limitations on this? Have any of you Fools out there had any similar experience or have any words of wisdom for us? Thanks!
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