Learn the crucial differences between earned and unearned income, including their definitions, examples, and relevance to tax regulations such as the Kiddie Tax.
A custodial account is a financial account that parents or guardians create for a minor, typically at a bank or brokerage firm. Minors cannot make financial transactions without the approval of the account trustee.
Income Shifting involves transferring gross income to another taxpayer in a lower tax bracket, thereby reducing the overall tax liability of a group or family. This technique is often used to optimize tax savings.
Kiddie Tax concerns the tax liability for children under a certain age on net unearned income exceeding a specified threshold, taxed at the parents' highest marginal tax rate.
A comprehensive exploration of the legal definition, rights, and obligations concerning a minor, including voidable contracts and tax implications.
The Kiddie Tax is a tax policy affecting individuals under the age of 18 or up to 24 in certain circumstances, aimed at taxing unearned income above a specific threshold. This article delves into its definition, functioning, and applicability.
