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Here is a link to the instructions for the form:  Form 8615 Instructions  see page 5 for instructions on capital gains.

"Unearned income" is income gained from a source other than employment, work, or other business activity. Money from work, by contrast, is "earned income." Unearned income includes all forms of investment income, including interest, dividends, most rent and royalty income. It also includes capital gains—the profit you make when you sell something for more than what you paid for it.

Who must file the form?

For 2020, a child must file Form 8615 if all of the following conditions apply:

• The child has more than $2,200 in unearned income
• The child is required to file a tax return
• The child does not file a joint tax return with a spouse
• At least one of the child's parents is alive
• The child is within certain age limits

For tax purposes, the child's "age" is the age on December 31. The child must file the form if any of these conditions apply:

• The child is under 18 at the end of the year
• The child is 18 years old and does not have earned income that is more than half of the child's support for the year, or
• The child was a full-time student age 19-23 and does not have earned income that is more than half of the child's support

Treatment of unearned income

In general, in 2020 the first $1,100 worth of a child's unearned income is tax-free. The next $1,100 is taxed at the child's income tax rate for 2020. Anything above $2,200, however, is taxed at the rate that applies to trusts and estates, which usually is higher than the child's rate. This tax treatment has gained a nickname: the "kiddie tax." Calculating how much tax applies to the child's income is the purpose of Form 8615.

Form 8615 Instructions  see page 5 for instructions on capital gains.