I've entered the Segal award for my daughter (21 years, graduated December 2021) reported on the 1099-MISC using the Wages & Income, Less Common Income, Miscellaneous Income path as reported in previous posts. She earned this money while working in the summer of 2021 before she graduated. Because the unearned income ($2929) exceeded $2200 by $729, I had to report my taxable income and qualified dividends. It appears that some amount of my daughters unearned income, perhaps $729, will be taxed at my marginal tax rate, which is termed the kiddie tax. This unearned income does not derive from investments but results from her working with Americorps, which paid next to nothing in income. Is there a way to designate this unearned income such that it is not subjected to the kiddie tax?
