Affiliate Marketing/Paypal/Taxes for people under 18.

Well my friend is a few years younger, just turned 16. He wants to get involved in affiliate marketing, but doesn't want to break any terms of service. The logical thing here would be to get one of his parent's to sign up and earn under them. However, when it comes to do their taxes, how would they go about saying that it was him earning the money under their name? The money he earns would be going into a back account with his name solely on an account.

Thanks for any help in advanced.

 

I am 16, and I have used my SSN on plenty of networks. I would use his SSN, networks do not care as long as he is earning them money.

 

Yes, but if they find out, they can easily terminate your account for violation of the TOS. He wants to make sure he does everything the correct way, not violating any TOS.

 

Basically, you have to pay tax as a just in case factor. If you don't, you run the risk of no account or no money. I'm 16, I earn £3.5k a year as I only work part time whilst studying at college.

 

In the TOS of all the major networks, it says you have to be 18. This is because in the US, people under 18 cannot hold a legally binding contract. He doesn't want to break any TOS or rules, just because he can get away with it doesn't mean he wants to take that route.

So the question remains, how can he sign up and report taxes if he is under 18?

 

Have his parents file an LLC because that will separate their personal accounts from the corporate (LLC) accounts. Best way to go is use a service like bizfilings.com - that way there is no violation of TOS due to age requirements because the LLc is the entity doing business with the affiliate programs.

In fact, it's wise for anybody marketing and making money on the internet to spend the money to incorporate of file an LLC or an INC because if a lawsuit arises, your personal accounts can't be attached.

 

That was exactly the answer he needs. Thanks for that!

 

One more thing... If he does go the LLC route, tell him to file the paperwork as have zero employees (file with your friend and the co-signer as principles or partners). If he they list themselves as employees they will be responsible for paying unemloyment insurance. Also, one of the benefits of having an LLC is that items such as a new computer, laptop, hosting fees, domain registrations are all depreciable on taxes

 

This is the thread that i'm looking for. But can you tell me how the differences between filing tax by your self(17 years old) and using that LLC, services? Which pay more tax and how about their pros and cons? I'm clueless about these tax systems.

 

And what if we don't want to file as partnership, is it possible? And how?