A 19 year old student won 15,000 in the lottery, is he subject to the kidie tax? And if so can he deduct his losses on line 9 of the 8615 as the portion of the amount directly connected with the production of childs investment income? Thanks
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I'll take the easy half: Yes, it's subject to the kiddie tax. The IRS use of the term "investment income" is misleading, as it's really "unearned income."
As for the losses, I won't venture to answer, but I do have a question: From where did a 19 year old come up with the money to have significant amounts of gambling losses? -
His losses are only about $200, spent on lottery tickets.Comment
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Line 9 on the 8615 is for the calculation of the tax. I originally assumed that was a typo and that line 2 was intended. With only $200 of losses, it's a non-issue, because he's better off taking the $1900 standard reduction.
Or did you mean someplace else?Comment
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