Any sexual content involving a real person under the age of 18 is completely out. That’s just not negotiable in any way, shape, or form. That includes flashbacks to explicit matter in the real person’s past, whether fictional or not.
Now the slippery slope… what about the other characters? As far as AFF’s official position, if the underage character is clearly fictional, there is no legal prohibition and therefore no concrete reason for us to object, other than perhaps good taste (although that is my personal distaste for the entire genre of celebrity fiction showing, I fear).
Because we are dealing with real persons, I am very conservative, and would strongly recommend you not place any real person in the position of committing fictional pedophilia. I’m quite sure most celebrities are uncomfortable enough with most of the fan fiction about them, explicit or otherwise, but crossing that line might be a bit too far for their legal and public relations people. If you’re writing about real persons of your acquaintance, I’d hazard a guess you might be ending friendships and/or relationships. There is the additional consideration of not knowing who might see the story. If it’s sent to a minor, or a family member of the real person...ouch. And it has happened to one of our authors with a RPF they thought was deleted.
So, the short answer? If the underage character is not real, it’s not prohibited, but we moderators do read those with a fine tooth comb (and a large whiskey at hand) and we will err on the side of caution.