Kiddie Tax vs. Inclusion in Parents Return

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  • grandpaalb
    Junior Member
    • Mar 2015
    • 1

    #1

    Kiddie Tax vs. Inclusion in Parents Return

    Parents have $175,000 taxable income. Child(18) in college has about $8,000 in taxable income, all of which is LT Capital Gains at 0%. On his own he would have no tax liability. Using Form 8615 & his parents effective rate, he would owe about $1,000. Would appreciate opinion on most taxpayer effective way to report-Kiddie Tax or inclusion in Parents?
  • Gary2
    Senior Member
    • Aug 2010
    • 2066

    #2
    Originally posted by grandpaalb
    Parents have $175,000 taxable income. Child(18) in college has about $8,000 in taxable income, all of which is LT Capital Gains at 0%. On his own he would have no tax liability. Using Form 8615 & his parents effective rate, he would owe about $1,000. Would appreciate opinion on most taxpayer effective way to report-Kiddie Tax or inclusion in Parents?
    You can't report general capital gains on the parents' return (just 1099-INT, -OID, and -DIV). So unless you meant 8K in qualified dividends or capital gain distributions on a 1099-DIV, you don't have a choice. It has to go on the child's return, using the 8615.

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