V is 11 years of age, her only income is interest from savings of $3,200, and she has no itemized deductions.V is claimed as a dependent by her parents.V's taxable income is $2,250 for 2012, $1,300 of which is taxed at her parents' marginal tax rate.

Question

Quizplus · Accepted Answer

Since V is a dependent, her taxable income is only taxed at her parents' marginal tax rate. Therefore, $1,300 of her taxable income is taxed at her parents' rate and the remaining $950 is taxed at V's own tax rate.

V Is 11 Years of Age, Her Only Income Is