You Make the Call - May 21, 2026

Question: In 2025, Alex is 17 and can be claimed as a dependent by Alex's parent, Taylor. Alex received Forms 1099-INT, Interest Income, and 1099-DIV, Dividends and Distributions, reporting a combined $8,000 of taxable interest and ordinary dividends from a custodial brokerage account. Alex had no earned income, does not itemize deductions on Schedule A (Form 1040), Itemized Deductions, does not file a joint return and is required to file Form 1040, U.S. Individual Income Tax Return. Taylor was alive at the end of 2025 and will provide the information needed for Form 8615, Tax for Certain Children Who Have Unearned Income. How much of Alex's 2025 unearned income is treated as net unearned income on Form 8615, Line 5? 

Answer: Alex's net unearned income on Form 8615, Line 5, is $5,300. 

Alex meets the Form 8615 filing requirements because Alex was under age 18 at the end of 2025, had more than $2,700 of unearned income, must file a return, had a living parent at year-end and does not file a joint return. Alex must attach Form 8615 to Alex's Form 1040. 

Alex reports $8,000 of unearned income on Form 8615, Line 1. Because Alex does not itemize deductions, Alex enters $2,700 on Line 2. Alex subtracts Line 2 from Line 1, resulting in $5,300 on Line 3. 

Alex's Form 1040, Line 15, taxable income is $6,650. The amount is Alex's $8,000 adjusted gross income (AGI) minus the $1,350 dependent standard deduction because Alex had no earned income. Form 8615, Line 5, is the smaller of the amounts on Lines 3 and 4. Because $5,300 is less than $6,650, Alex enters $5,300 on Line 5. 

Section 1(g) requires Alex’s tax to be the greater of Alex’s regular tax or the tax computed under the kiddie tax rules, which use Alex’s net unearned income and Taylor’s tax information. Form 8615 uses the $5,300 Line 5 amount in that computation.