Self employment tax

[KYoung]

Each year this one gets me. I have read somewhere that I could pay my wife since she is my co driver, and drove the truck by herself for a few months.

Also our 19 year old daughter and her 1 year old lives in our home, she does some data entry for me. She doesn't have a job, so we pay all her expenses. I was thinking of giving her a 1099 equal to what all her deductions.

Would these things help lower the self-employment tax? Are they allowed? Is there anything else I can do?

Thanks
KYoung

 

[Fkatz]

Hi KYoung,

I am very sorry I did not answer you sooner

Your Questions are/

Each year this one gets me. I have read somewhere that I could pay my wife since she is my co driver, and drove the truck by herself for a few months.?
Yes you can, but it is not the proper way to do it since you are filing as Married filing Jointly. you would still have to make out 2 SCH c's. anyway and only USe her part of the diem which is the full amount per day as yours, $41.00 and $46. for Canada

Also our 19 year old daughter and her 1 year old lives in our home, she does some data entry for me. She doesn't have a job, so we pay all her expenses. I was thinking of giving her a 1099 equal to what all her deductions..

If you are taking her as a dependent with your granddaughter or grandson, you would be better off as to overall deductions

Would these things help lower the self-employment tax? Are they allowed? Is there anything else I can do?

If this is your first year i would not worry about SE, you should have a loss overall. and no SE will have to be paid.

If you call me at 1-704-739-4039 or e-mail me direct at [[email protected]] I can give you a better idea

Frank