topic Kiddie tax being calculated incorrectly in Get your taxes done using TurboTax

Kiddie tax being calculated incorrectly

rach2381 — Sun, 08 Feb 2026 17:18:37 GMT

It would appear that Turbotax tax is calculating my daughter's tax rate wrongly on her federal tax return.

Because she earned over $15,750, her income cannot be included on my tax return. Under current tax laws, you have to include your taxable income on the child's tax return so they can be taxed at the parent's marginal tax rate instead of their own. From my understanding, the reason for this is that parents were claiming assets on their child's tax return instead of their own as a way to lower their own tax bill.

The way this should be calculated is as follows, all of the child's income over $2700 has to be taxed at the parent's marginal tax rate. For example our tax rate is 24% which means the calculation should be as follows.

(<unearned income> - 2700) * 0.24

In our case the software is calculating her federal taxes due at rate of 33%, instead of at our 24% marginal rate.

The state tax return (CA) is calculating her taxes due at the correct rate (9.3%).

It seems like there is a bug in the software for calculating the "kiddie tax" on unearned income for the federal taxes. Is there any way I can submit a support ticket for this to be investigated and fixed?

Re: Kiddie tax being calculated incorrectly

DoninGA — Sat, 07 Feb 2026 20:57:09 GMT

The Kiddie Tax is based on unearned income of the child, not earned income like wages.

If the child has unearned income, interest, dividends, capital gains, of over $2,100 then they have to complete IRS Form 8615 - https://www.irs.gov/forms-pubs/about-form-8615

Since the child has earned income they have to file their own tax return, reporting both their earned and unearned income.

Re: Kiddie tax being calculated incorrectly

rach2381 — Sun, 08 Feb 2026 17:17:12 GMT

As I stated before, she did have unearned income over the threshhold and she is filing her own return. Turbotax is just calculating her tax liability wrongly on her federal taxes.

Is there any way I can submit a ticket to have turbotax look into this?

Re: Kiddie tax being calculated incorrectly

DoninGA — Sun, 08 Feb 2026 17:34:29 GMT

@rach2381 See this TurboTax support FAQ for contacting support - https://ttlc.intuit.com/turbotax-support/en-us/help-article/account-management/turbotax-phone-number/L0Od33nMQ_US_en_US?uid=lfgviwbm

Support is open from 5am to 5pm, Monday thru Friday, Pacific time

Re: Kiddie tax being calculated incorrectly

rach2381 — Sun, 08 Feb 2026 18:27:30 GMT

I already called them. They said they can only connect me with a tax professional which is not what I need. Apparently there is no way to report bugs. The rep told me the best I can do is come on here and hope someone from TurboTax sees my post and elevates the issue. It's ridiculous. I don't know of any other reputable software company that doesn't have a way to report issues with their product. Makes me reconsider if using their product is even a good plan. If nobody can get any support for technical issues, it makes me wonder what other bugs they are ignoring after taking our money. We are putting our trust in this company to get our taxes right when we provide full and accurate information.

Re: Kiddie tax being calculated incorrectly

Linprell — Mon, 16 Mar 2026 13:59:06 GMT

I am seeing a similar issue - TurboTax shows what the tax at the parent rate is but does not actually adjust for that. So the taxes owing are higher than they shiould be . I'm not sure what to do

Re: Kiddie tax being calculated incorrectly

DaveF1006 — Mon, 16 Mar 2026 14:35:11 GMT

To clarify, is the $15,750 from earned income, such as from working or is it strictly investment income? If so, what type of investments?

@rach2381

Re: Kiddie tax being calculated incorrectly

Linprell — Mon, 16 Mar 2026 15:03:53 GMT

It calculated correctly after I logged out and back in - I read there could be a lag on that - so all good. And it was mostly capital gains.