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Family, Kids & Dependents

§127 for Adult Children in Family C-Corp

Employ your college-age kid in the C-corp → $5,250/yr tax-free tuition assistance.

Overview

IRC §127 lets a C-corp reimburse an employee $5,250/yr for tuition + student loans tax-free. Hire your college-age or adult child as legitimate employee, offer §127 plan — company deducts, kid gets $5,250 of tuition covered tax-free. Only C-corp path works cleanly (2%+ S-corp owners are excluded, but their non-owner-relative employees still qualify).

Best fit
C-corp business owners with college-age kidsMulti-generational family businessesFamily businesses hiring nieces/nephews
Estimated impact
$5,250/yr per child × 37% bracket = $2K/yr federal savings

Click Generate advisory deep dive for mechanics, IRC citations, a step-by-step execution plan, a worked numeric example on your profile, costs, risks, and this-week actions.

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