Kiddie Tax
TaxesA tax rule applying the parent's tax rate to a child's unearned income above a threshold, preventing tax avoidance through transfers.
Example
Example: On a $75,000 salary, understanding kiddie tax could save you hundreds or thousands at tax time. For instance, if you are in the 22% marginal bracket, knowing how kiddie tax works helps you make smarter decisions about deductions, credits, and withholding. Check your tax picture with our income tax calculator.