We want to establish a partnership where one of the partners is a Minor. Is it possible? are there any Tax implications of doing that? Who would have the Power of attorney for the Minor, can it be with the parents?
If you can suggest any link we can get more Information on this- it would be appreciated.
ChristineL | Former Moderator |
2/21/2010 - 7:41 pm
Hi shwez,
A minor can sign a contract, but because minors are not considered to have the legal competency to enter into a binding agreement, they have ability to 'disaffirm' the contract.
If a parent chooses to form the business on behalf of their child, they can act as an authorized signer. Liabilities apply in these situations, and parents can be held responsible if their dependent is negligent in matters of operating the business.
The IRS offers specific tax guidance for young entrepreneurs, including resources to determine if you need to file federal income tax returns.
Read more in our blog article: Young Entrepreneurs - Advice for Starting a Business as a Minor.
ChristineL | Former Moderator | 2/21/2010 - 7:41 pm
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