Susan is 17 and is claimed as a dependent by her parents. In 2018, she earns $1,000 from a summer job and receives $2,400 of interest from a savings account. How much of Susan's income is taxable at the rates applicable to estates and trusts?

Question

Quizplus · Accepted Answer

Since Susan is claimed as a dependent by her parents and her unearned income (i.e. interest income) exceeds $1,050, a portion of her income will be subject to the rates applicable to estates and trusts. The taxable income will be calculated as follows: 
- Interest income: $2,400 
- Less: Standard deduction for estates and trusts ($300): ($300) 
- Taxable income: $2,100

Therefore, the answer is (B) $300.

Susan Is 17 and Is Claimed as a Dependent by Her