Children under 18 and full time students under 24 are taxed differently than other taxpayers if
I.Their unearned income exceeds $2,100.
II.Their parents' marginal tax rate exceeds 15%.

Question

Children under 18 and full time students under 24 are taxed differently than other taxpayers if
I.Their unearned income exceeds $2,100.
II.Their parents' marginal tax rate exceeds 15%.
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Quizplus · Accepted Answer

Statement I is correct because children under 18 and full-time students under 24 are subject to the "kiddie tax" rules if their unearned income exceeds $2,100. Statement II is incorrect because the parents' marginal tax rate is relevant to how the "kiddie tax" is calculated, but it does not determine if the child is taxed differently; the key factor is the child's unearned income level.

Children Under 18 and Full Time Students Under 24 Are