Salaries paid to your children from your business for work they performed are not deductible if excessive in amount. Salaries are deductible by a business for amounts that are reasonable for the personal services actually rendered to the business. When an amount deducted as wages involves a familial relationship, particularly a parent-child relationship, the I.R.S. may scrutinize the wages paid to determine if there is a bona fide employer-employee relationship and whether the payments were made for services actually performed for the business and reasonable in amount.