Assume Alan's parents make gifts of $10,000 to him every year starting at age one,Alan's parents are in the 35 percent income tax bracket,and Alan is now 15 years old and has $11,700 of interest income for 2017.

a.Calculate the tax on Alan's interest income.
b.Explain why the "kiddie tax" rules are in the law.

Question

Assume Alan's parents make gifts of $10,000 to him every year starting at age one,Alan's parents are in the 35 percent income tax bracket,and Alan is now 15 years old and has $11,700 of interest income for 2017.
​
a.Calculate the tax on Alan's interest income.
b.Explain why the "kiddie tax" rules are in the law.

Quizplus · Accepted Answer

The Answer of Assume Alan's parents make gifts of $10,000 to him every year starting at age one,Alan's parents are in the 35 percent income tax bracket,and Alan is now 15 years old and has $11,700 of interest income for 2017.
​
a.Calculate the tax on Alan's interest income.
b.Explain why the "kiddie tax" rules are in the law.

Assume Alan's Parents Make Gifts of $10,000 to Him Every