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lcole855
New Member

Form 8615 net qualified dividends, total capital gain, net capital gain

The instructions they give on the page "Information About Other Children" refers to a second page and a third page to fill out the net qualified dividends, total capital gain, and net capital gain, but we only have one page of form 8615. To fill in these blanks we are unable to follow the instructions given to fill in these blanks. Please advise.

3 Replies
gloriah5200
Expert Alumni

Form 8615 net qualified dividends, total capital gain, net capital gain

After you complete the 8615 in the child's tax return using the parents info, then it will ask you about other children:

"Do the parents have other children who file a Form 8615?"

 

As long as you say yes, it will pop up another information form for another child's Form 8615 information filed/to be filed with their return.

 

The other children's information is entered starting at "information about other children". As long as you continue to answer yes, it will continue to bring up another worksheet to enter another child's Form 8615 information.

 

More than likely, you will have to first complete the parent's return, then one of the children's return including their Form 8615.  Then prepare another child's Form 8615 in their return and include the information from the first child's F8615. Then go back to the first one and enter the information from the second child's 8615 into their return.

 

Form 8615 is used in the child's return when the child is filing their own return but being taxed at the parent's tax rate, so you also need the parent's information in the return

 

For additional information, refer to the following:

IRS Instructions for Form 8615

TMS70
Level 1

Form 8615 net qualified dividends, total capital gain, net capital gain

 

 

Cynthiad66
Employee Tax Expert

Form 8615 net qualified dividends, total capital gain, net capital gain

Here is a link to the instructions for the form:  Form 8615 Instructions  see page 5 for instructions on capital gains.

 

"Unearned income" is income gained from a source other than employment, work, or other business activity. Money from work, by contrast, is "earned income." Unearned income includes all forms of investment income, including interest, dividends, most rent and royalty income. It also includes capital gains—the profit you make when you sell something for more than what you paid for it.

Who must file the form?

For 2020, a child must file Form 8615 if all of the following conditions apply:

  • The child has more than $2,200 in unearned income
  • The child is required to file a tax return
  • The child does not file a joint tax return with a spouse
  • At least one of the child's parents is alive
  • The child is within certain age limits

For tax purposes, the child's "age" is the age on December 31. The child must file the form if any of these conditions apply:

  • The child is under 18 at the end of the year
  • The child is 18 years old and does not have earned income that is more than half of the child's support for the year, or
  • The child was a full-time student age 19-23 and does not have earned income that is more than half of the child's support

Treatment of unearned income

In general, in 2020 the first $1,100 worth of a child's unearned income is tax-free. The next $1,100 is taxed at the child's income tax rate for 2020. Anything above $2,200, however, is taxed at the rate that applies to trusts and estates, which usually is higher than the child's rate. This tax treatment has gained a nickname: the "kiddie tax." Calculating how much tax applies to the child's income is the purpose of Form 8615.

 

Form 8615 Instructions  see page 5 for instructions on capital gains.

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