Should You Get Your Family Involved in Your Business?

Should You Get Your Family Involved in Your Business? family business

When you ponder situations where people have a family business, you might automatically picture farms. Or, maybe you picture small shops that have been in the family for generations in a large city such as New York. Likely the reason your thoughts travel to these scenarios is due, at least in part, to what you have seen on TV.

But reality can be very different from what is portrayed on television. Although I happen to come from a family farm, not every family business is run by parents who hire their kids to help. Some family businesses are owned by a Grandparent, aunt, uncle, or even a child who has hired a parent.

But when it comes to business and family becoming mixed, things can get weird. We all know that money and family can create tension, stress, or hard feelings, and the same can happen with a family business.

So, before you decide to get your family involved in your business, make sure you consider all the pros and cons of paying your family (or kids) to help in you business.

Pros of Paying Family for Helping Your Business:

Tax Benefits

Of course, some people who hire their children in their business are doing so only on paper in order to benefit when it comes time to pay Uncle Sam. If you have done this and the IRS catches on, it could spell bad news for your business. For example, you could lose your tax benefits on these deductions altogether.

To prevent this from happening, make your family member a legitimate employee. Pay them by check and keep track of duties performed, as well as time sheets, etc. If you have tax questions about hiring children or other family members you can go to the IRS website for help.

You Already Know Them

Hiring a family member, over someone you don’t know, means you already know what skills they have. Plus, you know where they could improve before you even hire them. You aren’t running the risk of hiring someone who says they have the ability to do the job but then isn’t able to follow through.

Less Training Time

It may take less time to train a family member who is already somewhat familiar with what you do in your business. But there are times when this isn’t necessarily true too.


They May Take Advantage of You

There are some risks when you hire family members in your business. Let’s say you hire a parent or sibling in your business. They may take advantage of you, whether consciously or unconsciously. They could break the rules thinking its ok because they are family. Or, they may not take their work as seriously because it’s not seen as a “real job” since they are related to you.

Other Employees May Resent it

Hiring family members who break the rules with no consequences can cause other staff members to feel resentful. You must be careful to only give raises and promotions when they are warranted and document carefully. Productivity of other employees could drop if you aren’t careful.

They Might Not Be Right for the Job

Even though you might question whether or not they can do the job, you might hire them anyway to “give them a chance” simply because they are family. This could cost your business both time and money until you figure it out. Plus, you may eventually need to replace them with a more qualified employee, which also takes time and money.

If you are wondering whether or not you should pay your family to help in your business, there are no easy, clear-cut answers. You must weigh each situation individually and carefully in order to make the best decision for you and your business.

Do you think it is wise to pay your family to help in your business? Do you have a successful family business?

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Written By
Sydney White is a Texas-born stay at home mom who enjoys spending time with her family, bargain hunting and, of course, writing. She is currently the editor-in-chief of

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