Kiddie Tax

I have a 12 year old son whose investment income was over

4000. Since he's under 18 and his income was over 1700, I filled out a Form 8615 to (try to) figure his tax. (Oh, btw, I also have a 14 year old daughter whose investment income requires this form, too. That made it a little complicated.) Does it make sense that the Form 8615 made no difference, that is to say, line 17 (tax on his income as computed from Dividend and Cap Gain worksheet) was a larger value than line 16?
> > > > > > > > >
Reply to
Anon
Loading thread data ...

the concept of the kiddee tax is for your kids to pay tax at your (the parent's) marginal tax rate so, you can't do the kids returns until yours is done you need to put in your (the parent's) income (don't have form infront of me now, so I can't state the line #) ___________________________________

-----> real address on hobokeni or hobokenx

Reply to
Benjamin Yazersky CPA

I thought the kiddie tax only applied to earned income.

Stu

Reply to
Stuart A. Bronstein

Just the opposite. It only applies to investment income.

-- Rich Carreiro snipped-for-privacy@animato.arlington.ma.us

Reply to
Rich Carreiro

Right. In fact, I think the idea is that the first 850 is "tax free." The second 850 is taxed at the kids rate, and everything above 1700 is taxed at the parents rate. I assume by marginal tax rate, you mean marginal tax rate for capital gains. I had taxable income in the area of 56k, and a capital gain around 800. Is my marginal tax rate 5% for cap gain?

Right, I did my taxes and entered my taxable income on the

8615 form and followed the instructions. Thanks for the response, sorry about alluding to personal data, but I'm confused and want to get this right.
Reply to
Anon

Good thing I don't do returns. ;-)

Stu

Reply to
Stuart A. Bronstein

BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.