Q. If the kid’s income comprise of non-qualifed dividends and capital gains and the parents marginal tax rate is 24% but capital gains is at 15%. What would be the rate applied for amount pass the 2500 threshold.
A. Simple answer:15%. But, it would depend on how close the parent's income is to the next bracket. Some could be at 20% (unlikely).
It is what it is and will be calculated on form 8615. Any difference will be miniscule. It was having to deal with this complicated calculation that first got me to buy TurboTax, 25 years ago!
