Child has 24,000 capital gains from UTMA account held by grandparent

[squinty3]

My child has $24,000 in capital gains in an UTMA account held by grandparents in my child's name. Dividends are $1,980. 

Am I required to file child's own return and form 8615? Tax is paid at 15% rate? Grandparents are saying there is an exemption if child files their own return and has capital gains under $50,000, that they should not owe any taxes. I am unable to find any exemptions or other rules. Child is 13 and has no earned income. Please help.

Thanks!

Parents taxable income around 125K.

[Bsch4477]

No such exemption and Kiddie Tax applies. TurboTax will calculate all that for you when you do the child’s return. 

[Mike9241]

must do parents' return first. 

[squinty3]

Parents taxable income around 125K. 

[fanfare]

The real question is, will the grandparent pay the tax?

The kid can't,  obviously.

Unless there are other gifts already, not mentioned.

@squinty3 

[squinty3]

So even if the money is still in the account, we still have to pay taxes on it now when the stock was sold? Or do we pay taxes on it when the funds are actually taken out of the account and spent? I guess that's what confuses me.

[Bsch4477]

You report any taxable event which is when an asset is sold or produces income such as interest, dividends or capital gains distributions whether or not that income is withdrawn from the account.