Aloha!
I have two kids under 18 who I want to pay in business as they are legitimately working in business. I have a Family Management Company set up as a Sole Prop that my S corp will pay to pay my kids. Here’s my question - in Hawaii we are subject to GET Tax on gross unless we are W2 employees. I understand that the Family Management company will pay GET taxes on the management fee paid by the S-Corp, but if the Family Management Co. isn’t issuing the kids a W2, do they pay GET taxes (like a Independent Contractor would be required to)? I’m confused with my Aloha State’s rules as the kids who are hired by the Family Management Company would not be issued a 1099 or W2 so what is the deal with GET?
With Aloha, Sharon