Taxation of Minors
A free online guide
There are special rules, some for all dependent children, and others for children with investment income.
If your children have income, especially investment income, you may need to know the special rules that apply to their situation. The most frequently asked questions are answered on the following pages:
Tax Returns for Minors
When a minor child has income, who prepares the tax return? Who
signs it? And who owes the tax?
Standard Deduction and Personal
Exemption for Minors
A minor who can be claimed as a dependent is not allowed to
claim a personal exemption for himself or herself. The minor is
allowed a standard deduction, but the amount depends on whether
the minor's income is earned or unearned.
Minors Taxed at Parents' Rates: The
Kiddie Tax
Children under 18 years of age (and some that are older, beginning in
2008) have to pay tax at the rate that applies to
their parents' income if they have investment income above a
threshold amount .
Reporting Your Child's Income on
Your Return
Subject to limitations, you may be able to report income of
a child under 18 years of age on your own income tax return.
Capital Losses of Minors
What happens if there is a capital loss in your child's
custodial account, and your child doesn't have enough income to
take advantage of the loss?
Related
- Related guide: Custodial Accounts for Minors
- Related IRS forms and publications: Your Family
- Discussion forum: Other Tax Questions
