Kiddie Tax Calculator
Calculate a dependent child's federal tax under Form 8615 — net unearned income above the $2,700 threshold (2025 and 2026) is taxed at the parent's marginal rate. Includes Form 8814 parent-election comparison for children whose income is only interest and dividends.
Threshold: $2,700 (2× dependent standard deduction floor)
W-2 wages, self-employment
Interest, dividends, capital gains, UTMA/UGMA income
Form 1099-DIV box 1b — part of the total above, not extra
Schedule D net gain, including mutual-fund capital gain distributions — also part of the total above
AGI minus deductions (Form 1040 line 15)
Included in the taxable income above
Also included above — it decides how much 0% room is left under the child's slice
Form 8615 line 7 pools the children's net unearned income; this calculator covers the one-child case.
These force the Schedule D Tax Worksheet, which this calculator does not run.
Form 8814 election checks (optional)
The parents' election has eight IRS conditions, and the dollar amounts above answer only three of them. Confirm the rest and we will tell you whether the election is actually available — until then we report "needs review" rather than guess in your favour.
A mutual-fund capital gain distribution (Form 1099-DIV box 2a) is an allowed income type; the same dollar amount realised by selling stock is not.
Includes backup withholding shown on a Form 1099.
A 2025 overpayment applied to 2026 estimated tax counts.
Filing jointly with the child's other parent, the married-separate filer with the higher taxable income, or the custodial parent if unmarried, divorced or separated.
- Gross income (earned + unearned)
- $5,000
- Dependent standard deduction
- $1,350
- Taxable income
- $3,650
- Kiddie tax threshold
- $2,700
- Net unearned income (parent rate)
- $2,300
- Remainder (child rate)
- $1,350
- Parent marginal rate (ordinary)
- 22%
- Tax at parent rate
- $506
- Tax at child rate
- $135
- Allocation method (line 16)
- $641
- All at child's rates (line 17)
- $365
- Total federal tax (line 18)
- $641
- Kiddie tax penalty (vs all-child-rate)
- $276
Child under 18 at year-end with unearned income above the threshold.
5 Form 8814 conditions are still unconfirmed, so the election cannot be recommended yet. Any figures below are provisional.
- Only interest and dividend income (incl. capital gain distributions)Tell us what the unearned income actually is. A mutual-fund capital gain distribution is allowed; a gain on selling stock is not — and both look identical as a dollar figure.
- Child does not file a joint return for 2026Confirm whether the child files a joint return — a joint return bars the election.
- No estimated tax payments for the child (incl. a 2025 overpayment applied to 2026)Confirm whether any estimated tax was paid under the child’s name and SSN, including a 2025 overpayment carried forward.
- No federal income tax withheld from the child’s incomeConfirm whether any federal income tax — including backup withholding on a Form 1099 — was withheld from the child’s income.
- The electing parent qualifiesConfirm the electing parent qualifies: filing jointly with the child’s other parent, the married-separate filer with the higher taxable income, or the custodial parent if unmarried, divorced or separated.
- Child tax on second tier (10%)
- $135
- Amount added to parent return
- $2,300
- — as qualified dividends (line 9)
- $0
- — as capital gain (line 10)
- $0
- — as ordinary income (line 12)
- $2,300
- Parent additional tax
- $506
- Form 8814 total cost
- $641
- Form 8615 total tax
- $641
All eight Form 8814 conditions
- Under age 19 at year-end, or under 24 if a full-time student (2026) — metThe selected age category is inside the Form 8814 age test.
- Only interest and dividend income (incl. capital gain distributions) — unconfirmedTell us what the unearned income actually is. A mutual-fund capital gain distribution is allowed; a gain on selling stock is not — and both look identical as a dollar figure.
- Gross income under $13,500 — metGross income of $5,000 is below the $13,500 ceiling (10 × the $1,350 dependent standard deduction floor, IRC §1(g)(7)(A)(ii)).
- Child is required to file a 2026 return — metUnearned income above $1,350 requires a return (Pub. 501 Table 2), which the election then takes the place of.
- Child does not file a joint return for 2026 — unconfirmedConfirm whether the child files a joint return — a joint return bars the election.
- No estimated tax payments for the child (incl. a 2025 overpayment applied to 2026) — unconfirmedConfirm whether any estimated tax was paid under the child’s name and SSN, including a 2025 overpayment carried forward.
- No federal income tax withheld from the child’s income — unconfirmedConfirm whether any federal income tax — including backup withholding on a Form 1099 — was withheld from the child’s income.
- The electing parent qualifies — unconfirmedConfirm the electing parent qualifies: filing jointly with the child’s other parent, the married-separate filer with the higher taxable income, or the custodial parent if unmarried, divorced or separated.
Kiddie tax thresholds by year — 2024, 2025, 2026
Every kiddie-tax number is built from one inflation-adjusted amount: the dependent standard deduction floor in IRC §63(c)(5)(A). The unearned-income threshold is exactly twice that floor, and the Form 8814 election ceiling is exactly ten times it (IRC §1(g)(7)). The IRS publishes the floor each fall in a Revenue Procedure — for 2026 it did not increase, so the threshold stays at $2,700.
| Tax year | Tax-free tier | Child-rate tier | Parent's rate above | Form 8814 ceiling | IRS source |
|---|---|---|---|---|---|
| 2026 | $1,350 | $1,350 | $2,700 | $13,500 | Rev. Proc. 2025-32 |
| 2025 | $1,350 | $1,350 | $2,700 | $13,500 | Rev. Proc. 2024-40 |
| 2024 | $1,300 | $1,300 | $2,600 | $13,000 | Rev. Proc. 2023-34 |
"Tax-free tier" is sheltered by the child's dependent standard deduction; the "child-rate tier" is taxed at the child's own single-filer rates; everything above the threshold is net unearned income taxed at the parent's marginal rate on Form 8615.
How the three tiers work
The kiddie tax splits a child's unearned income into three slices. Here is the split for a child under 18 with $5,000 of interest and dividends, no wages, and parents who file jointly with $200,000 of taxable income (2025) — every figure computed by the same engine that powers the calculator above:
| Tier | Amount | Taxed at | Tax |
|---|---|---|---|
| 1. Tax-free | $1,350 | Nothing — covered by the dependent standard deduction | $0 |
| 2. Child's rate | $1,350 | Child's own single-filer bracket | $135 |
| 3. Parent's rate | $2,300 | Parents' marginal rate (22% here) | $506 |
| Total federal tax on the child's income | $641 | ||
Without the kiddie tax, the same $3,650 of taxable income at the child's own rates would owe $365 — so the parent-rate treatment costs this family an extra $276. Form 8615 computes tier 3 precisely: it is the parents' tax recomputed with the child's net unearned income stacked on top, minus the parents' tax without it, so it always lands at the parents' true marginal rate.
Form 8615 vs Form 8814
Two different forms implement the kiddie tax. Form 8615 lives on the child's return; Form 8814 is an optional election that moves the child's income onto the parents' return. The election is only available when all eight IRS conditions hold: the child is under 19 at year-end (under 24 if a full-time student), their only income is interest, dividends and capital gain distributions, gross income is under $13,500 (2025), the child is required to file, files no joint return, had no federal income tax withheld and no estimated tax paid in their name, and the electing parent is the one whose return the child's tax must be figured on.
| Form 8615 | Form 8814 | |
|---|---|---|
| Who files | The child, on their own Form 1040 | The parents, on their Form 1040 (no child return needed) |
| When it applies | Mandatory whenever the kiddie tax applies and no election is made | Optional election, and only if every one of the eight conditions below is met |
| Income limit | None — required no matter how large the unearned income | Child's gross income must be under $13,500 (2025 and 2026) |
| Other bars | None | Any federal income tax withheld from the child's income, any estimated tax paid in the child's name (including a prior-year overpayment applied forward), or a joint return filed by the child all rule the election out. The child must also actually be required to file — below $1,350 of unearned income there is no return to replace. |
| Earned income allowed | Yes — wages simply stay at the child's rate | No — any earned income disqualifies the election |
| How income is taxed | First $1,350 tax-free, next $1,350 at child's rate, excess at parents' marginal rate | First $1,350 tax-free, next $1,350 at a flat 10%, excess added to parents' taxable income |
| Effect on parents' AGI | None — child's income stays off the parents' return | Raises AGI — can reduce IRA deductibility, education credits, and other AGI-based phase-outs |
| Capital-gains rates | Preserved — net capital gain and qualified dividends taxed at preferential rates via the Qualified Dividends and Capital Gain Tax Worksheet | Mostly preserved. Form 8814 lines 7–10 prorate the amount above $2,700 across the child's qualified dividends and capital gain distributions, and each slice lands on the matching line of the parents' return — line 9 on Form 1040 lines 3a/3b, line 10 on Schedule D line 13. What IS lost is the tier between $1,350 and $2,700: under the election it is taxed at a flat 10%, where a separate child return could have taxed it at 0%. The IRS puts the maximum cost of that at $135. |
In the three-tier example above, the Form 8814 route would cost $641 — $135 of tax on the second tier plus $506 of extra parent tax on the $2,300 added to their return — exactly the same dollar amount as Form 8615 in that scenario. When the two tie, Form 8615 is usually the safer pick because it leaves the parents' AGI untouched. The calculator flags whichever route is cheaper for your inputs.
Age rules — who is subject to the kiddie tax
The age tests come from IRC §1(g)(2) and the Form 8615 instructions (Publication 929 covered this until it was retired after 2022; its content now lives in Publication 501 and the form instructions). The child must also have at least one living parent at year-end and must not file a joint return. This calculator models each category exactly as described below.
Under 18 at year-end
Always subject when unearned income exceeds $2,700. No support test — even a child actor earning a full-time salary is caught on their investment income.
Exactly 18 at year-end
Subject only if the child's earned income does not exceed half of their own support. An 18-year-old working full-time and paying most of their own way is exempt; an 18-year-old supported by parents is not.
Age 19–23, full-time student
Subject only if the child is a full-time student for at least five months of the year AND earned income does not exceed half of their support. A 22-year-old junior on a parent-paid meal plan is in scope; a 21-year-old who dropped to part-time study is not.
Age 24 and older
Never subject, even as a full-time student with zero earned income. From the year the child turns 24, all income is taxed at their own rates — no Form 8615, no election needed.
"Support" means total spending on the child's housing, food, education, medical care, and similar costs for the year — scholarships are excluded from the calculation. Earned income from a job is never itself kiddie-taxed; see the teen summer job tax calculator for how a working teen's wages are taxed.
Worked kiddie tax examples (2025)
Three complete Form 8615 computations, produced by the calculator's engine — you can reproduce any of them by entering the same inputs above.
Example 1 — $5,000 of interest and dividends, no wages
Child under 18; parents married filing jointly with $200,000 taxable income.
| Dependent standard deduction | $1,350 |
|---|---|
| Child's taxable income | $3,650 |
| Net unearned income (over $2,700) | $2,300 |
| Tax at parents' 22% rate | $506 |
| Tax at child's rate on remaining $1,350 | $135 |
| Total tax (kiddie tax cost: $276) | $641 |
Example 2 — $8,000 summer-job wages plus $4,000 of investment income
Full-time student age 19–23 whose earned income is under half of support; parents married filing jointly with $80,000 taxable income. Wages raise the dependent standard deduction (earned income plus $450), which shelters most of the total.
| Dependent standard deduction | $8,450 |
|---|---|
| Child's taxable income | $3,550 |
| Net unearned income (over $2,700) | $1,300 |
| Tax at parents' 12% rate | $156 |
| Tax at child's rate on remaining $2,250 | $225 |
| Total tax (kiddie tax cost: $26) | $381 |
The wages themselves are never kiddie-taxed — only the $1,300 of net unearned income moves to the parents' rate. Form 8814 is unavailable here because the child has earned income.
Example 3 — $22,000 long-term capital gain in a custodial account
Child under 18 sells appreciated UTMA stock for a $22,000 long-term gain; parents married filing jointly with $150,000 taxable income. The gain far exceeds the $13,500 ceiling — and a sale gain is not a permitted Form 8814 income type in any case — so the child must file with Form 8615.
| Dependent standard deduction | $1,350 |
|---|---|
| Child's taxable income | $20,650 |
| Net unearned income (over $2,700) | $19,300 |
| — of which net capital gain (line 5 worksheet) | $19,300 |
| Rate it actually bears | 15% |
| Tax at the parents' rate (line 13) | $2,895 |
| Tax at the child's rate on the rest (line 15) | $0 |
| Total federal tax (line 18) | $2,895 |
| Same $22,000 as plain interest, for contrast | $4,381 |
Because the income is long-term capital gain, Form 8615 splits it with the Line 5 Worksheet and figures lines 9, 15 and 17 on the Qualified Dividends and Capital Gain Tax Worksheet: the $19,300 of net unearned income stacks on the parents' $150,000 of taxable income and is taxed at 15%, while the child's remaining $1,350 sits inside the child's own 0% band (which runs to $48,350 of taxable income for a single filer). The same $22,000 as bank interest would cost $4,381 instead — the gap is what preferential treatment is worth here. Two cases this calculator does not compute: collectibles (28% rate) gain and unrecaptured section 1250 gain, which require the Schedule D Tax Worksheet, and a parent with a second child filing Form 8615. Answer the two questions in the calculator and it will tell you when your scenario needs one of them. For the LTCG brackets themselves, see the capital gains tax calculator.
Frequently asked questions
What is the kiddie tax?
The kiddie tax (IRC §1(g), reported on Form 8615) taxes a child's unearned income above an annual threshold — $2,700 for 2025 and $2,700 for 2026 — at the parent's marginal tax rate instead of the child's lower rate. It exists to stop families from shifting investment income to children just to use the child's lower brackets. It applies to children under 18 at year-end, children who are exactly 18 whose earned income does not exceed half of their own support, and full-time students age 19–23 whose earned income does not exceed half of their support.
What is the kiddie tax threshold for 2024, 2025, and 2026?
$2,600 for 2024 (Rev. Proc. 2023-34), $2,700 for 2025 (Rev. Proc. 2024-40), and $2,700 for 2026 (Rev. Proc. 2025-32 — unchanged from 2025). The threshold is always twice the dependent standard deduction floor: the first $1,350 of unearned income is tax-free, the next $1,350 is taxed at the child's own rate, and only the amount above $2,700 is taxed at the parent's marginal rate.
How is the kiddie tax calculated?
Three steps. First, compute the child's taxable income: gross income minus the dependent standard deduction, which is the greater of $1,350 or earned income plus $450, capped at the regular single standard deduction of $15,750 (2025). Second, compute net unearned income: unearned income minus the $2,700 threshold, capped at taxable income. That amount is taxed at the parent's marginal rate on Form 8615. Third, the remaining taxable income is taxed at the child's own single-filer rates.
What is the kiddie tax age limit?
The kiddie tax can apply through age 23. Under 18 at year-end: always in scope. Exactly 18 at year-end: in scope only if the child's earned income does not exceed half of their own support. Age 19–23 at year-end: in scope only if the child is a full-time student AND earned income does not exceed half of their support. From age 24 onward the kiddie tax never applies, regardless of student status or how large the unearned income is — the child simply files their own return at their own rates.
Does the kiddie tax apply to a 22-year-old college student?
Usually yes. A 22-year-old who is a full-time student for at least five months of the year and whose earned income (wages, self-employment) does not exceed half of their own support is subject to the kiddie tax on unearned income above $2,700 (2025). The escape hatches: stop being a full-time student, reach age 24, or earn enough from work to provide more than half of your own support — any one of these switches all income back to the child's own rates.
Form 8615 vs Form 8814 — which should I file?
Form 8615 goes on the child's own return and taxes net unearned income at the parent's rate; it is mandatory whenever the kiddie tax applies and no election is made. Form 8814 is an optional parent election with eight conditions, all of which must hold: the child is under 19 at year-end (under 24 if a full-time student); their only income is interest, dividends and capital gain distributions; gross income is under $13,500 (2025); the child is required to file; the child files no joint return; no federal income tax was withheld from the child's income; no estimated tax was paid in the child's name (including a prior-year overpayment applied forward); and the electing parent qualifies. A realised gain on selling stock is not a permitted income type even though a mutual-fund capital gain distribution of the same size is. Under the election the first $1,350 is tax-free, the next $1,350 is taxed at 10%, and everything above $2,700 is added to the parents' taxable income. Form 8814 saves paperwork but raises the parents' AGI, which can shrink IRA deductibility, education credits, and other AGI-based benefits. This calculator computes both routes side by side whenever the election is available.
What counts as unearned income for the kiddie tax?
Taxable interest, ordinary and qualified dividends, capital gains (including capital gain distributions from mutual funds), rents, royalties, trust distributions, the taxable part of Social Security or pension benefits, and all investment income inside UTMA/UGMA custodial accounts. Earned income — wages from a job or net self-employment earnings — is never subject to the kiddie tax and is always taxed at the child's own rate.
Are long-term capital gains subject to the kiddie tax?
Yes — long-term capital gains count toward unearned income and toward the $2,700 threshold, and they keep their preferential character. Form 8615 splits net unearned income into its qualified-dividend, net-capital-gain and ordinary parts using the Line 5 Worksheet, then figures lines 9, 15 and 17 on the Qualified Dividends and Capital Gain Tax Worksheet, stacking the gain on top of the parents' taxable income at 0% / 15% / 20% (2025 married filing jointly, depending on the parents' income) instead of their ordinary bracket. Enter the gain in the "of which net long-term capital gain" field and the calculator does this; leave it at zero and every dollar is treated as interest. Two cases still need a preparer: collectibles (28% rate) gain and unrecaptured section 1250 gain, which require the Schedule D Tax Worksheet, and a parent with more than one child filing Form 8615.
Does my child need to file a tax return?
A dependent child must file for 2025 if unearned income exceeds $1,350, earned income exceeds $15,750, or gross income exceeds the larger of $1,350 or earned income plus $450 (up to $15,750). Below those levels no return is required — and unearned income at or below the $2,700 kiddie-tax threshold never triggers parent-rate tax even when a return is required. Filing thresholds come from IRS Publication 501.
How can families reduce or avoid the kiddie tax?
Keep the child's annual investment income at or under the $2,700 threshold (2025) by choosing growth assets over income-producing ones, or use wrappers whose earnings are not taxed to the child each year: 529 plans (tax-free for education), Series EE/I savings bonds (interest deferrable until redemption), and Roth IRAs funded from the child's own earned income. Realizing gains gradually across years — instead of one large sale — also keeps each year under the threshold. Earned income from a summer job is never kiddie-taxed.
Sources
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