Should my dependent file a tax return for a UTMA account to offset dividend income with a capital loss?

[g456nb]

I have an extension to file my 2024 taxes until Oct 15, and was planning to report my dependent's UTMA account on my return. 

For 2024, my dependent had a capital loss of $600 and dividend income of $1500. If my child files an individual tax return instead filing with my tax return, are we able to:

1) Offset the capital loss against the income? I tried creating a tax return in turbotax, and it looks like that reduces the AGI so no taxes will be owed.

2) If my child files an individual tax return now without me filing for for an extension, will there be a penalty for late tax submission? Or there would be no penalty as long as no taxes are owed?

3) Are there any issues that I'm missing about improper or incorrect tax filing for my dependent? 

Thanks very much

[Bsch4477]

You can’t deduct your dependent’s capital loss. They should file their own return taking care to check the box saying someone can claim them. Their capital loss will offset part of their dividend income so no tax will be owed. There’s no penalty since no tax is owed.