My son of 9 years has a custodial account (UTMA). It has a small dividend income (< $100) and some short term stock gains (< $500). My questions are,
1. How do I enter this information in Turbo Tax and I assume this needs to be reported under by son's name?
2. Will TT take care of exempting any taxes since the income is less than $1,300 ( for 2024?
3. Next year (i.e .2025) if the income from stock trades + dividends is again less than $1350 (for 2025 the limit for unearned income exempt from taxes is $1350 for minors), will my son still be exempt from Federal taxes again?
Thank you for time and help.
If this is the only income that your son has, it doesn't need to be reported on any tax return.
Thanks so much Susan. So I assume if in 2025 again, my son has less than $1350 income, I do not need to report that income in TT at all. Is that correct?
That is correct as well, so long as there is not a change in tax law around the amount of a child's unearned income that is taxable or required to be reported.