Employing your children

[Alexis H.]

More specifically, if during the first year, I make minimum income.. how will it effect my taxes if that said income is actually less than the child’s employment pay? For example, if I profit $500/month the first year, how will it turn out if I pay my child the $12k for the year but only make $6k? The additional would come out of my saving but what I’m trying to understand is, will my $6k for that year be taxed AND I will be $6k short of savings? Hopefully I didn’t make that too difficult to understand.