says i need subscription for alternate account. gold membership used to cover any account...

You need to make sure the account with gold has the console set as its Home console. https://beta.support.xbox.com/help/hardware-network/console/my-home-xbox

Make sure you are signed into your Gold Membership Account first, and then sign in your other account and then swap profiles.

I know for a fact that you are still able to do this, as I use an alt account in Rainbow Six Siege to play with friends. However, I tried to use an alt account on Black Ops 2 today, but it didn't work.. so maybe some games just don't allow it?

Hopefully this helps!

I just purchased a 12 month Gold membership, however, when I sign into Xbox live it says I still need a Gold membership. My online account shows that I purchased the 12 month subscription in my transaction too.

To be able to play any games online you need a Gold membership (paid subscription) and your account is only silver membership thus restricting your service availability.

Agreed. It sounds like you purchased Gold on the parental account. A Gold membership goes to the account purchasing, and only covers one account.

If this just happened, the billing department may be able to cancel that subscription and give you a code you can apply to the proper account. I'm not sure though.