Kiddie Tax
Kiddie Tax – New IRS Rules
Beginning with 2009, the amount that exceeds $1.900 of unearned income will be taxed to the child at the parent’s tax rate. The amount of unearned income increased from $1,800 in 2008.The first $950 of your child’s unearned income is tax-free. The next $950 is taxed at your child’s tax bracket.
New Age Requirements For Kiddie Tax
This tax rate applies until the year the child is 19. For those who attend full time college and their unearned income is half of their support, the kiddie tax applies until they are 24 years old.The kiddie tax used to apply only to children under 14 years old.