EMPLOYING YOUR CHILD

If you treat your writing as a business, you should be aware that you can save family income and payroll taxes by putting junior family members on the payroll. You may be able to turn high-taxed income into tax-free or low-taxed income, achieve social security tax savings (depending on how your buisness is organized) and even make retirement plan contributions for your child.

For 2008, changes take effect that broaden the reach of the "kiddie tax." As a result of these changes, employing a child age 18 (or if a full-time student, ages 19-23) can save taxes on his or her unearned income. Check with your accountant for details on this change and to find out if you and your child would qualify.