Some further discussions about hiring your kids in your business and using their earnings for college through a Roth of Traditional IRA:
The IRA may be ignored in measuring parent and student resources for purposes of college financial aid.
Monies in the IRA grow tax deferred.
The IRA might eliminate some or all of the child’s income from the kiddie tax – child’s income taxed at the parents’ rates.
The working child who earns more than the standard deduction benefits from both a tax deduciton for a contribution to a traditional IRA and that IRA’s inside buildup of tax-deferred savings.