Gwen in VA Posted September 8, 2009 Share Posted September 8, 2009 My head is still spinning with entrepreneurial stuff. (My hearth is BURIED in books about starting companies!) Ds wants to start a company. (Details don't matter here, but yes, we are highly in favor of it.) Problem -- there is NO information out there about the legalities of an under-18yo starting a company. I think the biggest problem might be with the IRS. None of the forms ask for the age of the applicant -- so I'm guessing it doesn't matter? Though I would love to hear a success story just so I can have at least a anecdotal story to throw at the town business office or the folks at the courthouse if he gets asked too many questions about his age. Does anyone know a child who has started a company (sole proprietorship or other) under the legal age of 18? Thanks! Quote Link to comment Share on other sites More sharing options...
LizzyBee Posted September 8, 2009 Share Posted September 8, 2009 A minor is taxed the same as an adult. He would need to file Schedule C as part of his tax return. I was thinking that the biggest issue would be the inability of 18-yos to create legally-binding contracts. Depending on the type of business, there may be people who would be unwilling to do business with him for that reason. Quote Link to comment Share on other sites More sharing options...
K-FL Posted September 8, 2009 Share Posted September 8, 2009 Here's an article in Entrepreneur about that. HTH & good luck! Quote Link to comment Share on other sites More sharing options...
Gwen in VA Posted September 8, 2009 Author Share Posted September 8, 2009 Thank you K-FL!!!!! I had a feeling that he couldn't start a company. Now I can return all of the books to the library! My husband and I are NOT running the company and have no wish to be the legal heads of it! :001_smile: He is currently selling his product, but the amount he is earning is low enough that it doesn't bump up against tax issues. He just wants to be able to create a website to showcase his product, and we won't let him until he has established the company legally. (Currently his customers find him by word of mouth and through recommendations on hobby-related forums.) He will turn 18 just before the end of his junior year, so he will still be able to establish the company and list it on his activities sheet before he applies to colleges! Any other thoughts are welcome -- dh and I are pathetically non-entrepreneurial. Quote Link to comment Share on other sites More sharing options...
KnitWit Posted September 14, 2009 Share Posted September 14, 2009 I'm sure you are aware, but just thought I'd point out, I have read numerous financial aid threads on College Confidential regarding this type situation and how it affects eligibility for financial aid for college. You might like to poke around there. :) Quote Link to comment Share on other sites More sharing options...
Gwen in VA Posted September 14, 2009 Author Share Posted September 14, 2009 Ds would only be earning at most $2 - 3K per year. I certainly don't see this affecting his FA in any meaningful way, though I appreciate the warning. This would be a hobby-related enterprise and it is time-intensive. Several adults do what my son wants to do, but only for "pin money" -- they all have full-time jobs. My son says there is only company in the world that does it full-time with employees, and that one is in France and is always having financial issues. We want to pursue doing it legally so ds can have a website and can mention what he does in college interviews and essays. In the grand scheme of sole proprietorships, what ds wants to do is small potatoes. I am just frustrated that we can't seem to break through the logjam of red tape to even verify the feasibility of it! The one thing I don't want is for my son to "learn" that starting a company is impossibly difficult! Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.