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131ledge
New Member

How do I file K-1 net long term capital gain distribution for college aged dependent that had gross wages before $6,300 threshold ?

I have two college aged kids that both had 2016 earnings under the $6,300 threshold for federal taxes, so had not planned to file for each. However, they have each received a net long term capital gain of approx. $4,600 on a Schedule K-1 (Line 4a) for 2016 from a trust that my mother had established for each. This distribution would now put them above the $6,300 federal filing tax threshold, please advise what options there are for each of their filing / minimizing their tax impact . Thanks !!


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BobB7
New Member

How do I file K-1 net long term capital gain distribution for college aged dependent that had gross wages before $6,300 threshold ?

There really aren't a bunch of options.  The K-1 info goes on their tax return and there will be some tax which results.Furthermore, some of the capital gain will be taxed at YOUR tax rates (the so called "kiddie tax") which means Form 8615 will be used and information from your tax return will be needed before the children's returns are completed.

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3 Replies
BobB7
New Member

How do I file K-1 net long term capital gain distribution for college aged dependent that had gross wages before $6,300 threshold ?

There really aren't a bunch of options.  The K-1 info goes on their tax return and there will be some tax which results.Furthermore, some of the capital gain will be taxed at YOUR tax rates (the so called "kiddie tax") which means Form 8615 will be used and information from your tax return will be needed before the children's returns are completed.

131ledge
New Member

How do I file K-1 net long term capital gain distribution for college aged dependent that had gross wages before $6,300 threshold ?

Could simple form 1040EZ be filed with this K-1 info or another form ?
BobB7
New Member

How do I file K-1 net long term capital gain distribution for college aged dependent that had gross wages before $6,300 threshold ?

No, see my expanded answer.  Turbotax will guide you through the forms but, as I said, have your completed return at hand when you sit down to do it.

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