Question

eBook Calculator Print item Problem 6-10 Unearned Income of Minor Children and Certain Students (LO 6.4) Explain the two different ways that the tax on uneared income of minor children, or "kiddie tax," can be reported. The kiddie tax may be computed on Form 8615 ✓ which is attached to the child's tax return. Alternatively, the parents may elect to include the income by attaching Form 3814 To make this election, the child's uneared income must be more than 1,000 X and less than 10,000 X Food Check My Wor Tax law contains provisions that limit the benefit of shifting income to certain dependent children. The net uneared income of dependent children may be taxed at their parents' rates. This parental tax rate applies to dependent children who are ages 18 or younger and students ages 19 through 23 at the end of the year, who have at least one living parent, and who have "net uneared income for the year

Answer 1

The kiddie tax may be computed on Form 8615 which is attached to the child's tax return .Alternatively , the parents may elect to include the income by attaching Form 8615.To make this election,the child's unearned income must be more than $2,200 and less than $11,000.