UGMA/UTMA accounts can be taxed to the child or to the parent. If a child has unearned income below a specific threshold, the parent may elect to include the child's dividends and capital gain distributions on their tax return by filing Form 8814.
If the child's only income is interest and dividend income (including
capital gain distributions) and totals less than $10,500, the child's
parent may be able to elect to include that income on the parent's
return rather than file a return for the child.
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