William and Irma have two children,Tom,age 13,and Sara,age 8.For 2013,Tom and Sara have a total parental tax of $5,600.Tom's net unearned income is $15,000,while Sara's net unearned income is $5,000.How much of the parental tax would be allocated to Sara on her 2013 tax return?

Question

Quizplus · Accepted Answer

The parental tax is allocated to each child based on their net unearned income as a proportion of the total net unearned income for both children. 
Total net unearned income = $15,000 (Tom) + $5,000 (Sara) = $20,000 
Sara's proportion of the total net unearned income = $5,000/$20,000 = 0.25 
Therefore, Sara's allocated parental tax = 0.25 x $5,600 = $1,400.

William and Irma Have Two Children,Tom,age 13,and Sara,age 8