Kiddie Tax

The IRS, in tax tip 2012-52, reminds us that investment income by dependents may be subject to tax at the parent marginal tax rate.  This is called the “kiddie tax”.  This can have a very significant effect on the   amount of federal income tax paid. Please see the full IRS article by clicking here for additional information as well as links to important forms pertaining to this subject.  If you have any questions, please contact our office at (781) 407-0300 or visit our website at www.gggcpas.com