During 2018, Jasmine (age 12) received $6,500 from a corporate bond. She also received $600 from a savings account established for her by her parents. Jasmine lives with her parents and she is their dependent. What is Jasmine's gross tax liability?

Question

During 2018, Jasmine (age 12) received $6,500 from a corporate bond. She also received $600 from a savings account established for her by her parents. Jasmine lives with her parents and she is their dependent. What is Jasmine's gross tax liability?

Quizplus · Accepted Answer

Jasmine's taxable income is $6,050 ($7,100 minus $1,050 standard deduction). Her net unearned income is $5,000 ($7,100 gross unearned income minus $2,100). This is taxed at trust and estate tax rates ($2,550 x 10%) + ($5,000 - $2,550) x 24%) = ($843 tax). The remaining $1,050 of her taxable income ($6,050 minus 5,000 taxed at her rate) is taxed at 10% ($105 tax). Total tax is $948 ($843 + 105).

During 2018, Jasmine (Age 12) Received $6,500 from a Corporate