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Kiddie tax

taxman6
Level 2

Client is 18 yr old dependent with $4000 in unearned income from stock sales. Also worked small job earning $748. He will be taxed at parents tax rate on 8815 form, BUT parents do not have option to claim his unearnmed income on thier taxes because he had a w-2 job. Proseries allows checking the box at top of 8815 hiwever to indcate that they DO have that opion and itr recalculates the taxes. It is my understanding this is incorrect as parents DO NOT haved that option. That box should not be able to be checked and the tax not recalculated. Proseries should correct that, unless I am totally wrong on this.

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3 Replies 3
taxman6
Level 2

In my last comment I meant form 8615 noit 8815

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Just-Lisa-Now-
Level 15
Level 15

get rid of the 8815.  The 8615 on the dependents return will compute the tax at the parents tax rate.

There was an issue with the 8615 and it required you to hit that Sch D calculation button on the 8615 for it to computer properly, Im not sure if that has been fixed or if that still needs to be done.


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
taxman6
Level 2

Thanks Lisa, I meant 8615. The point was though that there appears to be no validation on checking the box at the top of the 8615 indicating parents will report childs income on thier taxes. Since return knows client has w-2 wages, that precludes parents from being able to do that. That box should not be entereable in that situation.

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