Our business is a sole proprietor and up until now we mostly turn the small profits back into the business and do not draw any salary. We have occasionally taken small amounts out for personal stuff and count it as "owner's pay" for tax purposes.
I am interested in learning what is required to start legally and officially paying someone to do contract work for us. It would be payment on a per piece basis, not an hourly salary.
My son is going to be home from college in a few weeks and I don't know that he'll be able to get a summer job when he is only in town for 10 weeks. I plan to teach him how to use my sewing machine and put him to work cutting out and sewing tagbags. I plan to pay him $1-2 per piece. I want to officially have it as a business expense so that he can use the money for his college tuition. That way it's a way to use some of our business income to help with his college expenses but by him producing product in exchange.
Is there a good web page with info to tell us what steps we need to do - forms to file, taxes/social security to withhold, etc.
