Hiring your children to help you in your business is a smart tax planning strategy. The IRS says that children under 18 are not subject to social security, medicare taxes, or FUTA taxes. The State of AL says they are exempt from SUI until they are 21 and the same applies to FUTA. They are subject to Federal and State income taxes but a little planning can make sure you don’t exceed certain threshold amounts which would create the need to file a federal or state tax return. For some it may even be worth the filing for the tax savings.