Thank you, @Hal_Al This is very helpful. A few questions.
– I get the $400 calculation taxed at the parents’ rate. So, to confirm, if this is the “lower number,” our dependent will not owe any tax (at their rate) on any portion of the $7,137 unearned income?
–Re: the need (for the student) to file, in past exchanges you’ve said anyone with earned income > $400 needs to file. (Is this self-employment income only?) Beyond having total income > $15,750, my student needs to file to report taxable scholarships and 529 taxable earnings, right? (Taxed at their rate, not ours?)
My student has 1099-NEC income, W-2 income, scholarship & 529 earnings, to be clear. (They will have paid estimated SE tax by the time they file 1040.)
Thanks for helping us understand how this works!
