This is a huge area of responsibility for a parent. HUGE. Until the time, if ever, that your child’s career has become so lucrative that they need a business or financial manager, that responsibility falls to you. In California, New York, Louisiana, and New Mexico there are laws related to trust accounts for child performers. You will find other documents on this site related to specifics of what the parent responsibility is in that regard – but generally – a parent is responsible for doing research about banking options and opening an appropriate account, monitoring the withholdings from employment and matching them to deposits made into a trust account, communicating with employers past and present about accurate account information, and seeking alternative investment opportunities that are allowable by law.
Day to day decisions should be made with good financial sense. In California, the child actually OWNS all of their earnings, which is a distinction from every other state where those earnings are considered family money. Although it is certainly appropriate for their earnings to pay for their expenses related to employment – it is a parent’s responsibility to show good financial judgment. This includes not repeatedly paying for over priced photo sessions and similar optional business expenses. It is very easy to quickly whittle away past earnings in pursuit of other employment. Be prudent and mindful of those expenses.
In many states, including California, minors are eligible for unemployment compensation. There is a very comprehensive article on our website about Unemployment in California. It is a parent’s responsibility to determine if their child is eligible for benefits, and if they wish to apply for them. The biggest financial responsibility that parents are often not aware of concerns Income Tax. Federal tax law indicates that a parent is liable for a minor’s tax liability – so don’t make the mistake of thinking they don’t expect a child to file Income Tax returns. Minors pay taxes just like every other wage earner. There is a very detailed article on this site related to the specifics of Income Tax.
Lastly, it is a parents’ responsibility to ensure wages are received and that commissions, bills and union dues are paid.