form 8615 and table 2 from pub 501

Forum|Forum|1 year ago
February 27, 2025
1 reply
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Hello everyone. I am confused for dependent income.

On the top of table 2 from pub 501 it says: If your parent (or someone else) can claim you as a dependent, use this table to see if you must file a return.
In this table, unearned income includes taxable interest, ordinary dividends, and capital gain distributions. It also includes
unemployment compensation, taxable social security benefits, pensions, annuities, and distributions of unearned income from a
trust. Earned income includes salaries, wages, tips, professional fees, and taxable scholarship and fellowship grants. Gross income
is the total of your unearned and earned income. But when the dependent does have scholarship amount goes to form 8615 part I line 1 as unearned income. Could please help me to understand it. Since I have to check mark on the top of 8615 YES or NO

Thanks for help

ProSeries Professional

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Best answer by TaxGuyBill

For purposes of the Standard Deduction (which is what you are looking at in Publication 501), it is considered as "earned" (although haven't been able to find under what ruling that is allowed).

For purposes of calculating the Kiddie Tax (and I think for all other purposes), it is "unearned" income.

T

TaxGuyBillAnswer

Level 15

For purposes of the Standard Deduction (which is what you are looking at in Publication 501), it is considered as "earned" (although haven't been able to find under what ruling that is allowed).

For purposes of calculating the Kiddie Tax (and I think for all other purposes), it is "unearned" income.

HOPE2Author

Level 7

Thank you so much.

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