I have been able to repeat the scenario/calculation described by @Texas Roger and @Hal_Al. That is a dependent child with scholarship income over tuition and expenses. I see how the excess scholarship is treated as earned income for the purpose of filing and standard deduction. And I see how that excess income less standard deduction is treated as unearned income for the purpose of kiddie tax. However, it is my understanding that the calculation should be the same if the scenario is changed from a dependent child to independent. The kiddie tax is not tied to that status. However, TT is removing all kiddie tax when I make the filing child independent. In fact, after switching to independent TT forces me to remove any/all information from form 8615 including sames, checkboxes, and dollar amounts.
Is my understanding of independent children and kiddie tax correct? If so, how can I correct in TurboTax?
Edit: Wait - the instructions for 8615 only talks about dependent children. And the 5 tests only mention "child." Now I'm thinking this means qualifying child which is a dependent?
If that is the case, can the taxable excess scholarship count as support provided by the child for the purpose of determining they are independent?
The child had more than $2,200 of unearned income.
The child is required to file a tax return.
The child either:
Was under age 18 at the end of 2020,
Was age 18 at the end of 2020 and didn’t have earned income that was more than half of the child's support, or
Was a full-time student at least age 19 and under age 24 at the end of 2020 and didn’t have earned income that was more than half of the child's support.
(Earned income is defined later. Support is defined below.)
At least one of the child's parents was alive at the end of 2020.
The child doesn’t file a joint return for 2020.
