William and Irma have two children, Tom, age 13, and Sara, age 8. For 2015, Tom and Sara have a total parental tax of $5,600. Tom's net unearned income is $5,000, while Sara's net unearned income is $15,000. How much of the parental tax would be allocated to Sara on her 2015 tax return?

Question

Quizplus · Accepted Answer

Sara's net unearned income is higher than Tom's, so the parental tax is allocated based on the proportion of their net unearned income. Sara's share is ($15,000 / ($5,000 + $15,000)) * $5,600 = $4,200.

William and Irma Have Two Children, Tom, Age 13, and Sara