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Military Tax Filing

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Military Tax Filing

Military tax filing Publication 929 - Main Content Table of Contents Part 1. Military tax filing Rules for All Dependents Filing RequirementsEarned Income Only Unearned Income Only Both Earned and Unearned Income Other Filing Requirements Should a Return Be Filed Even If Not Required? Responsibility for Child's ReturnThird party designee. Military tax filing Designated as representative. Military tax filing IRS notice. Military tax filing Standard DeductionStandard Deduction of Zero Dependent's Own Exemption Withholding From WagesExceptions. Military tax filing Part 2. Military tax filing Tax on Unearned Income of Certain ChildrenWhich Parent's Return To Use Parent's Election To Report Child's Interest and DividendsEffect of Making the Election Figuring Child's Income Figuring Additional Tax Tax for Certain Children Who Have Unearned IncomeProviding Parental Information (Form 8615, Lines A–C) Step 1. Military tax filing Figuring the Child's Net Unearned Income (Form 8615, Part I) Step 2. Military tax filing Figuring a Tentative Tax at the Parent's Tax Rate (Form 8615, Part II) Step 3. Military tax filing Figuring the Child's Tax (Form 8615, Part III) Alternative Minimum Tax Illustrated Example Part 1. Military tax filing Rules for All Dependents This part of the publication discusses the filing requirements for dependents, who is responsible for a child's return, how to figure a dependent's standard deduction and exemption (if any), and whether a dependent can claim exemption from federal income tax withholding. Military tax filing Filing Requirements Whether a dependent has to file a return generally depends on the amount of the dependent's earned and unearned income and whether the dependent is married, is age 65 or older, or is blind. Military tax filing A dependent may have to file a return even if his or her income is less than the amount that would normally require a return. Military tax filing See Other Filing Requirements, later. Military tax filing The following sections apply to dependents with: Earned income only, Unearned income only, and Both earned and unearned income. Military tax filing  To find out whether a dependent must file, read the section that applies, or use Table 1. Military tax filing Earned Income Only A dependent whose gross income is only earned income must file a return if the gross income is more than the amount listed in the following table. Military tax filing Marital Status Amount Single   Under 65 and not blind $6,100 Either 65 or older or blind $7,600 65 or older and blind $9,100 Married*   Under 65 and not blind $6,100 Either 65 or older or blind $7,300 65 or older and blind $8,500 *If a dependent's spouse itemizes deductions on a separate return, the dependent must file a return if the dependent has $5 or more of gross income (earned and/or unearned). Military tax filing Example. Military tax filing William is 16. Military tax filing His mother claims an exemption for him on her income tax return. Military tax filing He worked part time on weekends during the school year and full time during the summer. Military tax filing He earned $7,000 in wages. Military tax filing He did not have any unearned income. Military tax filing He must file a tax return because he has earned income only and his gross income is more than $6,100. Military tax filing If he is blind, he does not have to file a return because his gross income is not more than $7,600. Military tax filing Unearned Income Only A dependent whose gross income is only unearned income must file a return if the gross income is more than the amount listed in the following table. Military tax filing Marital Status Amount Single   Under 65 and not blind $1,000 Either 65 or older or blind $2,500 65 or older and blind $4,000 Married*   Under 65 and not blind $1,000 Either 65 or older or blind $2,200 65 or older and blind $3,400 *If a dependent's spouse itemizes deductions on a separate return, the dependent must file a return if the dependent has $5 or more of gross income (earned and/or unearned). Military tax filing Example. Military tax filing Sarah is 18 and single. Military tax filing Her parents can claim an exemption for her on their income tax return. Military tax filing She received $1,970 of taxable interest and dividend income. Military tax filing She did not work during the year. Military tax filing She must file a tax return because she has unearned income only and her gross income is more than $1,000. Military tax filing If she is blind, she does not have to file a return because she has unearned income only and her gross income is not more than $2,500. Military tax filing Election to report child's unearned income on parent's return. Military tax filing   A parent of a child under age 19 (or under age 24 if a full-time student) may be able to elect to include the child's interest and dividend income on the parent's return. Military tax filing See Parent's Election To Report Child's Interest and Dividends in Part 2. Military tax filing If the parent makes this election, the child does not have to file a return. Military tax filing Both Earned and Unearned Income A dependent who has both earned and unearned income generally must file a return if the dependent's gross income is more than line 5 of the following worksheet. Military tax filing Filing Requirement Worksheet for Most Dependents 1. Military tax filing Enter dependent's earned income plus $350     2. Military tax filing Minimum amount   $1,000 3. Military tax filing Compare lines 1 and 2. Military tax filing Enter the larger amount     4. Military tax filing Maximum amount   6,100 5. Military tax filing Compare lines 3 and 4. Military tax filing Enter the smaller amount     6. Military tax filing Enter the dependent's gross income. Military tax filing If line 6 is more than line 5, the dependent must file an income tax return. Military tax filing If the dependent is married and his or her spouse itemizes deductions on a separate return, the dependent must file an income tax return if line 6 is $5 or more. Military tax filing       Table 1. Military tax filing 2013 Filing Requirements for Dependents If your parent (or someone else) can claim you as a dependent, use this table to see if you must file a return. Military tax filing   See the definitions of “dependent,”“earned income,”“unearned income,” and “gross income” in the Glossary. Military tax filing   Single dependents—Were you either age 65 or older or blind?     No. Military tax filing You must file a return if any of the following apply. Military tax filing       Your unearned income was over $1,000. Military tax filing Your earned income was over $6,100. Military tax filing Your gross income was more than the larger of—       $1,000, or Your earned income (up to $5,750) plus $350. Military tax filing         Yes. Military tax filing You must file a return if any of the following apply. Military tax filing     Your unearned income was over $2,500 ($4,000 if 65 or older and blind), Your earned income was over $7,600 ($9,100 if 65 or older and blind), Your gross income was more than the larger of—       $2,500 ($4,000 if 65 or older and blind), or Your earned income (up to $5,750) plus $1,850 ($3,350 if 65 or older and blind). Military tax filing       Married dependents—Were you either age 65 or older or blind?     No. Military tax filing You must file a return if any of the following apply. Military tax filing       Your gross income was at least $5 and your spouse files a separate return and itemizes deductions. Military tax filing Your unearned income was over $1,000. Military tax filing Your earned income was over $6,100. Military tax filing Your gross income was more than the larger of—       $1,000, or Your earned income (up to $5,750) plus $350. Military tax filing       Yes. Military tax filing You must file a return if any of the following apply. Military tax filing       Your gross income was at least $5 and your spouse files a separate return and itemizes deductions. Military tax filing Your unearned income was over $2,200 ($3,400 if 65 or older and blind), Your earned income was over $7,300 ($8,500 if 65 or older and blind), Your gross income was more than the larger of—       $2,200 ($3,400 if 65 or older and blind), or Your earned income (up to $5,750) plus $1,550 ($2,750 if 65 or older and blind). Military tax filing       Example 1. Military tax filing Joe is 20, single, not blind, and a full-time college student. Military tax filing He does not provide more than half of his own support, and his parents claim an exemption for him on their income tax return. Military tax filing He received $200 taxable interest income and earned $2,750 from a part-time job. Military tax filing He does not have to file a tax return because his gross income of $2,950 ($200 interest plus $2,750 in wages) is not more than $3,100, the amount on line 5 of his filled-in Filing Requirement Worksheet for Most Dependents (shown next). Military tax filing Filled-in Example 1 Filing Requirement Worksheet  for Most Dependents 1. Military tax filing Enter dependent's earned income plus $350   $ 3,100 2. Military tax filing Minimum amount   1,000 3. Military tax filing Compare lines 1 and 2. Military tax filing Enter the larger amount   3,100 4. Military tax filing Maximum amount   6,100 5. Military tax filing Compare lines 3 and 4. Military tax filing Enter the smaller amount   3,100 6. Military tax filing Enter the dependent's gross income. Military tax filing If line 6 is more than line 5, the dependent must file an income tax return. Military tax filing If the dependent is married and his or her spouse itemizes deductions on a separate return, the dependent must file an income tax return if line 6 is $5 or more. Military tax filing   $ 2,950   Example 2. Military tax filing The facts are the same as in Example 1 except that Joe had $600 taxable interest income. Military tax filing He must file a tax return because his gross income of $3,350 ($600 interest plus $2,750 wages) is more than $3,100, the amount on line 5 of his filled-in worksheet (shown next). Military tax filing Filled-in Example 2 Filing Requirement Worksheet for Most Dependents 1. Military tax filing Enter dependent's earned income plus $350   $ 3,100 2. Military tax filing Minimum amount   1,000 3. Military tax filing Compare lines 1 and 2. Military tax filing Enter the larger amount   3,100 4. Military tax filing Maximum amount   6,100 5. Military tax filing Compare lines 3 and 4. Military tax filing Enter the smaller amount   3,100 6. Military tax filing Enter the dependent's gross income. Military tax filing If line 6 is more than line 5, the dependent must file an income tax return. Military tax filing If the dependent is married and his or her spouse itemizes deductions on a separate return, the dependent must file an income tax return if line 6 is $5 or more. Military tax filing   $ 3,350   Age 65 or older or blind. Military tax filing A dependent who is age 65 or older or blind must file a return if his or her gross income is more than line 7 of the following worksheet. Military tax filing Filing Requirement Worksheet  for Dependents Who Are Age 65 or Older or Blind 1. Military tax filing Enter dependent's earned income plus $350     2. Military tax filing Minimum amount   $1,000 3. Military tax filing Compare lines 1 and 2. Military tax filing Enter the larger amount     4. Military tax filing Maximum amount   6,100 5. Military tax filing Compare lines 3 and 4. Military tax filing Enter the smaller amount     6. Military tax filing Enter the amount from the following table that applies to the dependent       Marital Status Amount     Single         Either 65 or older or blind $1,500       65 or older and blind $3,000     Married         Either 65 or older or blind $1,200       65 or older and blind $2,400   7. Military tax filing Add lines 5 and 6. Military tax filing Enter the total     8. Military tax filing Enter the dependent's gross income. Military tax filing If line 8 is more than line 7, the dependent must file an income tax return. Military tax filing If the dependent is married and his or her spouse itemizes deductions on a separate return, the dependent must file an income tax return if line 8 is $5 or more     Example 3. Military tax filing The facts are the same as in Example 2 except that Joe is also blind. Military tax filing He does not have to file a return because his gross income of $3,350 is not more than $4,600, the amount on line 7 of his filled-in Filing Requirement Worksheet for Dependents Who Are Age 65 or Older or Blind (shown next). Military tax filing   Filled-in Example 3 Filing Requirement Worksheet  for Dependents Who Are Age 65 or Older or Blind 1. Military tax filing Enter dependent's earned income plus $350   $3,100 2. Military tax filing Minimum amount   1,000 3. Military tax filing Compare lines 1 and 2. Military tax filing Enter the larger amount   3,100 4. Military tax filing Maximum amount   6,100 5. Military tax filing Compare lines 3 and 4. Military tax filing Enter the smaller amount   3,100 6. Military tax filing Enter the amount from the following table that applies to the dependent   1,500   Marital Status Amount     Single         Either 65 or older or blind $1,500       65 or older and blind $3,000     Married         Either 65 or older or blind $1,200       65 or older and blind $2,400   7. Military tax filing Add lines 5 and 6. Military tax filing Enter the total   4,600 8. Military tax filing Enter the dependent's gross income. Military tax filing If line 8 is more than line 7, the dependent must file an income tax return. Military tax filing If the dependent is married and his or her spouse itemizes deductions on a separate return, the dependent must file an income tax return if line 8 is $5 or more   $3,350 Other Filing Requirements Some dependents may have to file a tax return even if their income is less than the amount that would normally require them to file a return. Military tax filing A dependent must file a tax return if he or she owes any other taxes, such as: Social security and Medicare taxes on tips not reported to his or her employer or on wages received from an employer who did not withhold these taxes, Uncollected social security and Medicare or railroad retirement taxes on tips reported to his or her employer or on group-term life insurance, Alternative minimum tax, Additional tax on a health savings account from Form 8889, Part III, Recapture taxes, such as the tax from recapture of an education credit, or Additional tax on a qualified plan, including an individual retirement arrangement (IRA), or other tax-favored account. Military tax filing But if the dependent is filing a return only because of this tax, the dependent can file Form 5329 by itself. Military tax filing A dependent must also file a tax return if he or she: Had wages of $108. Military tax filing 28 or more from a church or qualified church-controlled organization that is exempt from employer social security and Medicare taxes, or Had net earnings from self-employment of at least $400. Military tax filing Spouse itemizes. Military tax filing   A dependent must file a return if the dependent's spouse itemizes deductions on a separate return and the dependent has $5 or more of gross income (earned and/or unearned). Military tax filing Should a Return Be Filed Even If Not Required? Even if a dependent does not meet any of the filing requirements discussed earlier, he or she should file a tax return if either of the following applies. Military tax filing Income tax was withheld from his or her income. Military tax filing He or she qualifies for the earned income credit, additional child tax credit, health coverage tax credit, or refundable American opportunity education credit. Military tax filing See the tax return instructions to find out who qualifies for these credits. Military tax filing  By filing a return, the dependent can get a refund. Military tax filing Responsibility for Child's Return Generally, a child is responsible for filing his or her own tax return and for paying any tax, penalties, or interest on that return. Military tax filing If a child cannot file his or her own return for any reason, such as age, the child's parent, guardian, or other legally responsible person must file it for the child. Military tax filing Signing the child's return. Military tax filing   If the child cannot sign his or her return, a parent or guardian must sign the child's name followed by the words “By (signature), parent (or guardian) for minor child. Military tax filing ” Authority of parent or guardian. Military tax filing   A parent or guardian who signs a return on a child's behalf can deal with the IRS on all matters connected with the return. Military tax filing   In general, a parent or guardian who does not sign the child's return can only provide information concerning the child's return and pay the child's tax. Military tax filing That parent or guardian is not entitled to receive information from the IRS or legally bind the child to a tax liability arising from the return. Military tax filing Third party designee. Military tax filing   A child's parent or guardian who does not sign the child's return may be authorized, as a third party designee, to discuss the processing of the return with the IRS as well as provide information concerning the return. Military tax filing The child or the person signing the return on the child's behalf must check the “Yes” box in the “Third Party Designee” area of the return and name the parent or guardian as the designee. Military tax filing   If designated, a parent or guardian can respond to certain IRS notices and receive information about the processing of the return and the status of a refund or payment. Military tax filing This designation does not authorize the parent or guardian to receive any refund check, bind the child to any tax liability, or otherwise represent the child before the IRS. Military tax filing See the return instructions for more information. Military tax filing Designated as representative. Military tax filing   A parent or guardian who does not sign the child's return may be designated as the child's representative by the child or the person signing the return on the child's behalf. Military tax filing Form 2848, Power of Attorney and Declaration of Representative, is used to designate a child's representative. Military tax filing See Publication 947, Practice Before the IRS and Power of Attorney, for more information. Military tax filing   If designated, a parent or guardian can receive information about the child's return but cannot legally bind the child to a tax liability unless authorized to do so by the law of the state in which the child lives. Military tax filing IRS notice. Military tax filing   If you or the child receives a notice from the IRS concerning the child's return or tax liability, you should immediately inform the IRS that the notice concerns a child. Military tax filing The notice will show who to contact. Military tax filing The IRS will try to resolve the matter with the parent(s) or guardian(s) of the child consistent with their authority. Military tax filing Child's earnings. Military tax filing   For federal income tax purposes, amounts a child earns by performing services are included in the gross income of the child and not the gross income of the parent. Military tax filing This is true even if, under state law, the parent has the right to the earnings and may actually have received them. Military tax filing If the child does not pay the tax due on this income, the parent may be liable for the tax. Military tax filing Child's expenses. Military tax filing   Deductions for payments that are made out of a child's earnings are the child's, even if the payments are made by the parent. Military tax filing Example. Military tax filing You made payments on your child's behalf that are deductible as a business expense and a charitable contribution. Military tax filing You made the payments out of your child's earnings. Military tax filing These items can be deducted only on the child's return. Military tax filing Standard Deduction The standard deduction for an individual who can be claimed as a dependent on another person's tax return is generally limited to the larger of: $1,000, or The individual's earned income plus $350, but not more than the regular standard deduction (generally $6,100). Military tax filing However, the standard deduction may be higher for a dependent who: Is 65 or older, or Is blind. Military tax filing Certain dependents cannot claim any standard deduction. Military tax filing See Standard Deduction of Zero , later. Military tax filing Worksheet 1. Military tax filing   Use Worksheet 1 to figure the dependent's standard deduction. Military tax filing Worksheet 1. Military tax filing Standard Deduction Worksheet for Dependents Use this worksheet only if someone else can claim you (or your spouse, if filing jointly) as a dependent. Military tax filing If you were 65 or older and/or blind, check the correct number of boxes below. Military tax filing Put the total number of boxes checked in box c and go to line 1. Military tax filing a. Military tax filing You 65 or older   Blind   b. Military tax filing Your spouse, if claiming  spouse's exemption 65 or older   Blind   c. Military tax filing Total boxes checked         1. Military tax filing Enter your earned income (defined below) plus $350. Military tax filing If none, enter -0-. Military tax filing 1. Military tax filing     2. Military tax filing Minimum amount. Military tax filing   2. Military tax filing $1,000   3. Military tax filing Compare lines 1 and 2. Military tax filing Enter the larger of the two amounts here. Military tax filing 3. Military tax filing     4. Military tax filing Enter on line 4 the amount shown below for your filing status. Military tax filing       Single or Married filing separately—$6,100 Married filing jointly—$12,200 Head of household—$8,950 4. Military tax filing     5. Military tax filing Standard deduction. Military tax filing         a. Military tax filing Compare lines 3 and 4. Military tax filing Enter the smaller amount here. Military tax filing If under 65 and not blind, stop here. Military tax filing This is your standard deduction. Military tax filing Otherwise, go on to line 5b. Military tax filing 5a. Military tax filing     b. Military tax filing If 65 or older or blind, multiply $1,500 ($1,200 if married) by the number in box c above. Military tax filing Enter the result here. Military tax filing 5b. Military tax filing     c. Military tax filing Add lines 5a and 5b. Military tax filing This is your standard deduction for 2013. Military tax filing 5c. Military tax filing     Earned income includes wages, salaries, tips, professional fees, and other compensation received for personal services you performed. Military tax filing It also includes any amount received as a scholarship that you must include in income. Military tax filing   Example 1. Military tax filing Michael is single, age 15, and not blind. Military tax filing His parents can claim him as a dependent on their tax return. Military tax filing He has taxable interest income of $800 and wages of $150. Military tax filing He enters $500 (his earned income plus $350) on line 1 of Worksheet 1. Military tax filing On line 3, he enters $1,000, the larger of $500 or $1,000. Military tax filing Michael enters $6,100 on line 4. Military tax filing On line 5a, he enters $1,000, the smaller of $1,000 or $6,100. Military tax filing His standard deduction is $1,000. Military tax filing Example 2. Military tax filing Judy, a full-time student, is single, age 22, and not blind. Military tax filing Her parents can claim her as a dependent on their tax return. Military tax filing She has dividend income of $275 and wages of $2,500. Military tax filing She enters $2,850 (her earned income plus $350) on line 1 of Worksheet 1. Military tax filing On line 3, she enters $2,850, the larger of $2,850 or $1,000. Military tax filing She enters $6,100 on line 4. Military tax filing On line 5a, she enters $2,850 (the smaller of $2,850 or $6,100) as her standard deduction. Military tax filing Example 3. Military tax filing Amy, who is single, is claimed as a dependent on her parents' tax return. Military tax filing She is 18 years old and blind. Military tax filing She has taxable interest income of $1,000 and wages of $2,000. Military tax filing She enters $2,350 (her earned income plus $350) on line 1 of Worksheet 1. Military tax filing She enters $2,350 (the larger of $2,350 or $1,000) on line 3, $6,100 on line 4, and $2,350 (the smaller of $2,350 or $6,100) on line 5a. Military tax filing Because Amy is blind, she checks the box for blindness and enters “1” in box c at the top of Worksheet 1. Military tax filing She enters $1,500 (the number in box c times $1,500) on line 5b. Military tax filing Her standard deduction on line 5c is $3,850 ($2,350 + $1,500). Military tax filing Standard Deduction of Zero The standard deduction for the following dependents is zero. Military tax filing A married dependent filing a separate return whose spouse itemizes deductions. Military tax filing A dependent who files a return for a period of less than 12 months due to a change in his or her annual accounting period. Military tax filing A nonresident or dual-status alien dependent, unless the dependent is married to a U. Military tax filing S. Military tax filing citizen or resident alien at the end of the year and chooses to be treated as a U. Military tax filing S. Military tax filing resident for the year. Military tax filing See Publication 519, U. Military tax filing S. Military tax filing Tax Guide for Aliens, for information on making this choice. Military tax filing Example. Military tax filing Jennifer, who is a dependent of her parents, is entitled to file a joint return with her husband. Military tax filing However, her husband elects to file a separate return and itemize his deductions. Military tax filing Because he itemizes, Jennifer's standard deduction on her return is zero. Military tax filing She can, however, itemize any of her allowable deductions. Military tax filing Dependent's Own Exemption A person who can be claimed as a dependent on another taxpayer's return cannot claim his or her own exemption. Military tax filing This is true even if the other taxpayer does not actually claim the exemption. Military tax filing Example. Military tax filing James and Barbara can claim their child, Ben, as a dependent on their return. Military tax filing Ben is a college student who works during the summer and must file a tax return. Military tax filing Ben cannot claim his own exemption on his return. Military tax filing This is true even if James and Barbara do not claim him as a dependent on their return. Military tax filing Withholding From Wages Employers generally withhold federal income tax, social security tax, and Medicare tax from an employee's wages. Military tax filing If the employee claims exemption from withholding on Form W-4, the employer will not withhold federal income tax. Military tax filing The exemption from withholding does not apply to social security and Medicare taxes. Military tax filing Conditions for exemption from withholding. Military tax filing   An employee can claim exemption from withholding for 2014 only if he or she meets both of the following conditions. Military tax filing For 2013, the employee had a right to a refund of all federal income tax withheld because he or she had no tax liability. Military tax filing For 2014, the employee expects a refund of all federal income tax withheld because he or she expects to have no tax liability. Military tax filing Dependents. Military tax filing   An employee who is a dependent ordinarily cannot claim exemption from withholding if both of the following are true. Military tax filing The employee's gross income will be more than $1,000, the minimum standard deduction for 2014. Military tax filing The employee's unearned income will be more than $350. Military tax filing Exceptions. Military tax filing   An employee may be able to claim exemption from withholding even if the employee is a dependent, if the employee: Is age 65 or older, Is blind, or Will claim on his or her 2014 tax return: Adjustments to income, Tax credits, or Itemized deductions. Military tax filing The above exceptions do not apply to supplemental wages greater than $1,000,000. Military tax filing For more information, see Exemption From Withholding in chapter 1 of Publication 505. Military tax filing Example. Military tax filing Guy is 17 and a student. Military tax filing During the summer he works part time at a grocery store. Military tax filing He expects to earn about $1,200 this year. Military tax filing He also worked at the store last summer and received a refund of all his withheld income tax because he did not have a tax liability. Military tax filing The only other income he expects during the year is $375 interest on a savings account. Military tax filing He expects that his parents will be able to claim him as a dependent on their tax return. Military tax filing He is not blind and will not claim adjustments to income, itemized deductions, a higher standard deduction, or tax credits on his return. Military tax filing Guy cannot claim exemption from withholding when he fills out Form W-4 because his parents will be able to claim him as a dependent, his gross income will be more than $1,000 (the minimum standard deduction amount) and his unearned income will be more than $350. Military tax filing Claiming exemption from withholding. Military tax filing    To claim exemption from withholding, an employee must enter “Exempt” in the space provided on Form W-4, line 7. Military tax filing The employee must complete the rest of the form, as explained in the form instructions, and give it to his or her employer. Military tax filing Renewing an exemption from withholding. Military tax filing   An exemption from withholding is good for only one year. Military tax filing An employee must file a new Form W-4 by February 15 each year to continue the exemption. Military tax filing Part 2. Military tax filing Tax on Unearned Income of Certain Children The two rules that follow may affect the tax on the unearned income of certain children. Military tax filing If the child's interest and dividend income (including capital gain distributions) total less than $10,000, the child's parent may be able to choose to include that income on the parent's return rather than file a return for the child. Military tax filing (See Parent's Election To Report Child's Interest and Dividends , later. Military tax filing ) If the child's interest, dividends, and other unearned income total more than $2,000, part of that income may be taxed at the parent's tax rate instead of the child's tax rate. Military tax filing (See Tax for Certain Children Who Have Unearned Income , later. Military tax filing ) For these rules, the term “child” includes a legally adopted child and a stepchild. Military tax filing These rules apply whether or not the child is a dependent. Military tax filing These rules do not apply if neither of the child's parents were living at the end of the year. Military tax filing Which Parent's Return To Use If a child's parents are married to each other and file a joint return, use the joint return to figure the tax on the child's unearned income. Military tax filing The tax rate and other return information from that return are used to figure the child's tax as explained later under Tax for Certain Children Who Have Unearned Income . Military tax filing Parents Who Do Not File a Joint Return For parents who do not file a joint return, the following discussions explain which parent's tax return must be used to figure the tax. Military tax filing Only the parent whose tax return is used can make the election described under Parent's Election To Report Child's Interest and Dividends . Military tax filing Parents are married. Military tax filing   If the child's parents file separate returns, use the return of the parent with the greater taxable income. Military tax filing Parents not living together. Military tax filing   If the child's parents are married to each other but not living together, and the parent with whom the child lives (the custodial parent) is considered unmarried, use the return of the custodial parent. Military tax filing If the custodial parent is not considered unmarried, use the return of the parent with the greater taxable income. Military tax filing   For an explanation of when a married person living apart from his or her spouse is considered unmarried, see Head of Household in Publication 501. Military tax filing Parents are divorced. Military tax filing   If the child's parents are divorced or legally separated, and the parent who had custody of the child for the greater part of the year (the custodial parent) has not remarried, use the return of the custodial parent. Military tax filing Custodial parent remarried. Military tax filing   If the custodial parent has remarried, the stepparent (rather than the noncustodial parent) is treated as the child's other parent. Military tax filing Therefore, if the custodial parent and the stepparent file a joint return, use that joint return. Military tax filing Do not use the return of the noncustodial parent. Military tax filing   If the custodial parent and the stepparent are married, but file separate returns, use the return of the one with the greater taxable income. Military tax filing If the custodial parent and the stepparent are married but not living together, the earlier discussion under Parents not living together applies. Military tax filing Parents never married. Military tax filing   If a child's parents have never been married to each other, but lived together all year, use the return of the parent with the greater taxable income. Military tax filing If the parents did not live together all year, the rules explained earlier under Parents are divorced apply. Military tax filing Widowed parent remarried. Military tax filing   If a widow or widower remarries, the new spouse is treated as the child's other parent. Military tax filing The rules explained earlier under Custodial parent remarried apply. Military tax filing Parent's Election To Report Child's Interest and Dividends You may be able to elect to include your child's interest and dividend income (including capital gain distributions) on your tax return. Military tax filing If you do, your child will not have to file a return. Military tax filing You can make this election only if all the following conditions are met. Military tax filing Your child was under age 19 (or under age 24 if a full-time student) at the end of the year. Military tax filing Your child had income only from interest and dividends (including capital gain distributions and Alaska Permanent Fund dividends). Military tax filing The child's gross income was less than $10,000. Military tax filing The child is required to file a return unless you make this election. Military tax filing The child does not file a joint return for the year. Military tax filing No estimated tax payment was made for the year, and no overpayment from the previous year (or from any amended return) was applied to this year under your child's name and social security number. Military tax filing No federal income tax was withheld from your child's income under the backup withholding rules. Military tax filing You are the parent whose return must be used when applying the special tax rules for children. Military tax filing (See Which Parent's Return To Use , earlier. Military tax filing ) These conditions are also shown in Figure 1. Military tax filing Certain January 1 birthdays. Military tax filing   A child born on January 1, 1995, is considered to be age 19 at the end of 2013. Military tax filing You cannot make this election for such a child unless the child was a full-time student. Military tax filing   A child born on January 1, 1990, is considered to be age 24 at the end of 2013. Military tax filing You cannot make this election for such a child. Military tax filing How to make the election. Military tax filing    Make the election by attaching Form 8814 to your Form 1040 or Form 1040NR. Military tax filing (If you make this election, you cannot file Form 1040A or Form 1040EZ. Military tax filing ) Attach a separate Form 8814 for each child for whom you make the election. Military tax filing You can make the election for one or more children and not for others. Military tax filing Effect of Making the Election The federal income tax on your child's income may be more if you make the Form 8814 election. Military tax filing Rate may be higher. Military tax filing   If your child received qualified dividends or capital gain distributions, you may pay up to $100 more tax if you make this election instead of filing a separate tax return for the child. Military tax filing This is because the tax rate on the child's income between $1,000 and $2,000 is 10% if you make this election. Military tax filing However, if you file a separate return for the child, the tax rate may be as low as 0% (zero percent) because of the preferential tax rates for qualified dividends and capital gain distributions. Military tax filing Deductions you cannot take. Military tax filing   By making the Form 8814 election, you cannot take any of the following deductions that the child would be entitled to on his or her return. Military tax filing The additional standard deduction if the child is blind. Military tax filing The deduction for a penalty on an early withdrawal of your child's savings. Military tax filing Itemized deductions (such as your child's investment expenses or charitable contributions). Military tax filing Figure 1. Military tax filing Can You Include Your Child's Income On Your Tax Return? Please click here for the text description of the image. Military tax filing Figure 1. Military tax filing Can You Include Your Child's Income On Your Tax Return? Deductible investment interest. Military tax filing   If you use Form 8814, your child's unearned income is considered your unearned income. Military tax filing To figure the limit on your deductible investment interest, add the child's unearned income to yours. Military tax filing However, if your child received qualified dividends, capital gain distributions, or Alaska Permanent Fund dividends, see chapter 3 of Publication 550 for information about how to figure the limit. Military tax filing Alternative minimum tax. Military tax filing    If your child received tax-exempt interest (or exempt-interest dividends paid by a regulated investment company) from certain private activity bonds, you must determine if that interest is a tax preference item for alternative minimum tax (AMT) purposes. Military tax filing If it is, you must include it with your own tax preference items when figuring your AMT. Military tax filing See Form 6251, Alternative Minimum Tax—Individuals, and its instructions for details. Military tax filing Reduced deductions or credits. Military tax filing   If you use Form 8814, your increased adjusted gross income may reduce certain deductions or credits on your return, including the following. Military tax filing Deduction for contributions to a traditional individual retirement arrangement (IRA). Military tax filing Deduction for student loan interest. Military tax filing Itemized deductions for medical expenses, casualty and theft losses, and certain miscellaneous expenses. Military tax filing Credit for child and dependent care expenses. Military tax filing Child tax credit. Military tax filing Education tax credits. Military tax filing Earned income credit. Military tax filing Penalty for underpayment of estimated tax. Military tax filing   If you make this election for 2013 and did not have enough tax withheld or pay enough estimated tax to cover the tax you owe, you may be subject to a penalty. Military tax filing If you plan to make this election for 2014, you may need to increase your federal income tax withholding or your estimated tax payments to avoid the penalty. Military tax filing Get Publication 505 for more information. Military tax filing Figuring Child's Income Use Form 8814, Part I, to figure your child's interest and dividend income to report on your return. Military tax filing Only the amount over $2,000 is added to your income. Military tax filing The amount over $2,000 is shown on Form 8814, line 6. Military tax filing Unless the child's income includes qualified dividends or capital gain distributions (discussed next), the same amount is shown on Form 8814, line 12. Military tax filing Include the amount from Form 8814, line 12, on Form 1040 or Form 1040NR, line 21. Military tax filing If you file more than one Form 8814, include the total amounts from line 12 of all your Forms 8814 on Form 1040 or Form 1040NR, line 21. Military tax filing On the dotted line next to line 21, enter “Form 8814” and the total of the Form 8814, line 12 amounts. Military tax filing Note. Military tax filing The tax on the first $2,000 is figured on Form 8814, Part II. Military tax filing See Figuring Additional Tax , later. Military tax filing Qualified dividends. Military tax filing   Enter on Form 8814, line 2a, any ordinary dividends your child received. Military tax filing This amount may include qualified dividends. Military tax filing Qualified dividends are those dividends reported on Form 1040, line 9b, or Form 1040NR, line 10b, and are eligible for lower tax rates that apply to a net capital gain. Military tax filing For detailed information about qualified dividends, see Publication 550. Military tax filing   If your child received qualified dividends, the amount of these dividends that is added to your income must be reported on Form 1040, lines 9a and 9b, or Form 1040NR, lines 10a and 10b. Military tax filing You do not include these dividends on Form 8814, line 12, or on line 21 of Form 1040 or Form 1040NR. Military tax filing   Enter the child's qualified dividends on Form 8814, line 2b. Military tax filing But do not include this amount on Form 1040, lines 9a and 9b, or Form 1040NR, lines 10a and 10b. Military tax filing Instead, include the amount from Form 8814, line 9, on Form 1040, lines 9a and 9b, or Form 1040NR, lines 10a and 10b. Military tax filing (The amount on Form 8814, line 9, may be less than the amount on Form 8814, line 2b, because lines 7 through 12 of the form divide the $2,000 base amount on Form 8814, line 5, between the child's qualified dividends, capital gain distributions, and other interest and dividend income, reducing each of those amounts. Military tax filing ) Capital gain distributions. Military tax filing   Enter on Form 8814, line 3, any capital gain distributions your child received. Military tax filing The amount of these distributions that is added to your income must be reported on Schedule D (Form 1040), line 13, or, if you are not required to file Schedule D, on Form 1040, line 13, or Form 1040NR, line 14. Military tax filing You do not include it on Form 8814, line 12, or on line 21 of Form 1040 or Form 1040NR. Military tax filing   Include the amount from Form 8814, line 10, on Schedule D, line 13; Form 1040, line 13; or Form 1040NR, line 14, whichever applies. Military tax filing (The amount on Form 8814, line 10, may be less than the amount on Form 8814, line 3, because lines 7 through 12 of the form divide the $2,000 base amount on Form 8814, line 5, between the child's qualified dividends, capital gain distributions, and other interest and dividend income, reducing each of those amounts. Military tax filing ) Collectibles (28% rate) gain. Military tax filing    If any of the child's capital gain distributions are reported on Form 1099-DIV as collectibles (28% rate) gain, you must determine how much to also include on line 4 of the 28% Rate Gain Worksheet, in the instructions for Schedule D, line 18. Military tax filing Multiply the child's capital gain distribution included on Schedule D, line 13, by a fraction. Military tax filing The numerator is the part of the child's total capital gain distribution that is collectibles (28% rate) gain. Military tax filing The denominator is the child's total capital gain distribution. Military tax filing Enter the result on line 4 of the 28% Rate Gain Worksheet. Military tax filing Unrecaptured section 1250 gain. Military tax filing   If any of the child's capital gain distributions are reported on Form 1099-DIV as unrecaptured section 1250 gain, you must determine how much to include on line 11 of the Unrecaptured Section 1250 Gain Worksheet in the instructions for Schedule D, line 19. Military tax filing Multiply the child's capital gain distribution included on Schedule D, line 13, by a fraction. Military tax filing The numerator is the part of the child's total capital gain distribution that is unrecaptured section 1250 gain. Military tax filing The denominator is the child's total capital gain distribution. Military tax filing Enter the result on the Unrecaptured Section 1250 Gain Worksheet, line 11. Military tax filing Section 1202 gain. Military tax filing   If any of the child's capital gain distributions are reported as section 1202 gain (gain on qualified small business stock) on Form 1099-DIV, part or all of that gain may be eligible for the section 1202 exclusion. Military tax filing (For information about the exclusion, see chapter 4 of Publication 550. Military tax filing ) To figure that part, multiply the child's capital gain distribution included on Schedule D, line 13, by a fraction. Military tax filing The numerator is the part of the child's total capital gain distribution that is section 1202 gain. Military tax filing The denominator is the child's total capital gain distribution. Military tax filing Your section 1202 exclusion is generally 50% of the result, but may be subject to a limit. Military tax filing In some cases, the exclusion is more than 50%. Military tax filing See the instructions for Schedule D for details and information on how to report the exclusion amount. Military tax filing Example. Military tax filing Fred is 6 years old. Military tax filing In 2013, he received dividend income of $2,100, which included $1,575 of ordinary dividends and a $525 capital gain distribution from a mutual fund. Military tax filing (None of the distributions were reported on Form 1099-DIV as unrecaptured section 1250 gain, section 1202 gain, or collectibles (28% rate) gain. Military tax filing ) All of the ordinary dividends are qualified dividends. Military tax filing He has no other income and is not subject to backup withholding. Military tax filing No estimated tax payments were made under his name and social security number. Military tax filing Fred's parents elect to include Fred's income on their tax return instead of filing a return for him. Military tax filing They figure the amount to report on Form 1040, lines 9a and 9b, the amount to report on their Schedule D, line 13, and the amount to report on Form 1040, line 21, as follows. Military tax filing They leave lines 1a and 1b of Form 8814 blank because Fred does not have any interest income. Military tax filing They enter his ordinary dividends of $1,575 on lines 2a and 2b because all of Fred's ordinary dividends are qualified dividends. Military tax filing They enter the amount of Fred's capital gain distributions, $525, on line 3. Military tax filing Next, they add the amounts on lines 1a, 2a, and 3 and enter the result, $2,100, on line 4. Military tax filing They subtract the base amount on line 5, $2,000, from the amount on line 4, $2,100, and enter the result, $100, on line 6. Military tax filing This is the total amount from Form 8814 to be reported on their return. Military tax filing Next, they figure how much of this amount is qualified dividends and how much is capital gain distributions. Military tax filing They divide the amount on line 2b, $1,575, by the amount on line 4, $2,100. Military tax filing They enter the result, . Military tax filing 75, on line 7. Military tax filing They divide the amount on line 3, $525, by the amount on line 4, $2,100. Military tax filing They enter the result, . Military tax filing 25, on line 8. Military tax filing They multiply the amount on line 6, $100, by the decimal on line 7, . Military tax filing 75, and enter the result, $75, on line 9. Military tax filing They multiply the amount on line 6, $100, by the decimal on line 8, . Military tax filing 25, and enter the result, $25, on line 10. Military tax filing They include the amount from line 9, $75, on lines 9a and 9b of their Form 1040 and enter “Form 8814 – $75” on the dotted lines next to lines 9a and 9b. Military tax filing They include the amount from line 10, $25, on line 13 of their Schedule D (Form 1040) and enter “Form 8814 – $25” on the dotted line next to Schedule D, line 13. Military tax filing They enter $100 ($75 + $25) on line 11 and -0- ($100 – $100) on line 12. Military tax filing Because the amount on line 12 is -0-, they do not include any amount from Form 8814 on their Form 1040, line 21. Military tax filing Figuring Additional Tax Use Form 8814, Part II, to figure the tax on the $2,000 of your child's interest and dividends that you do not include in your income. Military tax filing This tax is added to the tax figured on your income. Military tax filing This additional tax is the smaller of: 10% x (your child's gross income − $1,000), or $100. Military tax filing Include the amount from line 15 of all your Forms 8814 in the total on Form 1040, line 44, or Form 1040NR, line 42. Military tax filing Check box a on Form 1040, line 44, or Form 1040NR, line 42. Military tax filing Tax for Certain Children Who Have Unearned Income If a child's interest, dividends, and other unearned income total more than $2,000, part of that income may be taxed at the parent's tax rate instead of the child's tax rate. Military tax filing If the parent does not or cannot choose to include the child's income on the parent's return, use Form 8615 to figure the child's tax. Military tax filing Attach the completed form to the child's Form 1040, Form 1040A, or Form 1040NR. Military tax filing When Form 8615 must be filed. Military tax filing   Form 8615 must be filed for a child if all of the following statements are true. Military tax filing The child's unearned income was more than $2,000. Military tax filing The child is required to file a return for 2013. Military tax filing The child either: Was under age 18 at the end of the year, Was age 18 at the end of the year and did not have earned income that was more than half of his or her support, or Was over age 18 and under age 24 at the end of the year, was a full-time student, and did not have earned income that was more than half of his or her support. Military tax filing At least one of the child's parents was alive at the end of 2013. Military tax filing The child does not file a joint return for 2013. Military tax filing These conditions are also shown in Figure 2. Military tax filing Certain January 1 birthdays. Military tax filing   Use the following chart to determine whether certain children with January 1 birthdays meet condition 3 under When Form 8615 must be filed. Military tax filing IF a child was born on. Military tax filing . Military tax filing . Military tax filing THEN, at the end of 2013, the child is considered to be. Military tax filing . Military tax filing . Military tax filing January 1, 1996 18* January 1, 1995 19** January 1, 1990 24*** *This child is not under age 18. Military tax filing The child meets condition 3 only if the child did not have earned income that was more than half of the child's support. Military tax filing  **This child meets condition 3 only if the child was a full-time student who did not have earned income that was more than half of the child's support. Military tax filing  ***Do not use Form 8615 for this child. Military tax filing Figure 2. Military tax filing Do You Have To Use Form 8615 To Figure Your Child's Tax? Please click here for the text description of the image. Military tax filing Figure 2. Military tax filing Do You Have To Use Form 8615 To Figure Your Child's Tax? Providing Parental Information (Form 8615, Lines A–C) On Form 8615, lines A and B, enter the parent's name and social security number. Military tax filing (If the parents filed a joint return, enter the name and social security number listed first on the joint return. Military tax filing ) On line C, check the box for the parent's filing status. Military tax filing See Which Parent's Return To Use, earlier, for information on which parent's return information must be used on Form 8615. Military tax filing Parent with different tax year. Military tax filing   If the parent and the child do not have the same tax year, complete Form 8615 using the information on the parent's return for the tax year that ends in the child's tax year. Military tax filing Example. Military tax filing Kimberly must use her mother's tax and taxable income to complete her Form 8615 for calendar year 2013 (January 1 – December 31). Military tax filing Kimberly's mother files her tax return on a fiscal year basis (July 1 – June 30). Military tax filing Kimberly must use the information on her mother's return for the tax year ending June 30, 2013, to complete her 2013 Form 8615. Military tax filing Parent's return information not known timely. Military tax filing   If the information needed from the parent's return is not known by the time the child's return is due (usually April 15), you can file the return using estimates. Military tax filing   You can use any reasonable estimate. Military tax filing This includes using information from last year's return. Military tax filing If you use an estimated amount on Form 8615, enter “Estimated” on the line next to the amount. Military tax filing   When you get the correct information, file an amended return on Form 1040X, Amended U. Military tax filing S. Military tax filing Individual Income Tax Return. Military tax filing Extension of time to file. Military tax filing   Instead of using estimates, you can get an automatic 6-month extension of time to file if, by the date your return is due, you file Form 4868, Application for Automatic Extension of Time To File U. Military tax filing S. Military tax filing Individual Income Tax Return. Military tax filing See the instructions for Form 4868 for details. Military tax filing    An extension of time to file is not an extension of time to pay. Military tax filing You must make an accurate estimate of the tax for 2013. Military tax filing If you do not pay the full amount due by the regular due date, the child will owe interest and may also be charged penalties. Military tax filing See Form 4868 and its instructions. Military tax filing Parent's return information not available. Military tax filing   If a child cannot get the required information about his or her parent's tax return, the child (or the child's legal representative) can request the necessary information from the Internal Revenue Service (IRS). Military tax filing How to request. Military tax filing   After the end of the tax year, send a signed, written request for the information to the Internal Revenue Service Center where the parent's return will be filed. Military tax filing (The IRS cannot process a request received before the end of the tax year. Military tax filing )    You should also consider getting an extension of time to file the child's return, because there may be a delay in getting the requested information. Military tax filing   The request must contain all of the following. Military tax filing A statement that you are making the request to comply with section 1(g) of the Internal Revenue Code and that you have tried to get the information from the parent. Military tax filing Proof of the child's age (for example, a copy of the child's birth certificate). Military tax filing Evidence the child has more than $2,000 of unearned income (for example, a copy of the child's prior year tax return or copies of Forms 1099 for the current year). Military tax filing The name, address, social security number (if known), and filing status (if known) of the parent whose information is to be shown on Form 8615. Military tax filing    A child's legal representative making the request should include a copy of his or her Power of Attorney, such as Form 2848, or proof of legal guardianship. Military tax filing Step 1. Military tax filing Figuring the Child's Net Unearned Income (Form 8615, Part I) The first step in figuring a child's tax using Form 8615 is to figure the child's net unearned income. Military tax filing To do that, use Form 8615, Part I. Military tax filing Line 1 (Unearned Income) If the child had no earned income, enter on this line the adjusted gross income shown on the child's return. Military tax filing Adjusted gross income is shown on Form 1040, line 38; Form 1040A, line 22; or Form 1040NR, line 37. Military tax filing Form 1040EZ and Form 1040NR-EZ cannot be used if Form 8615 must be filed. Military tax filing If the child had earned income, figure the amount to enter on Form 8615, line 1, by using the worksheet in the instructions for the form. Military tax filing However, use the following worksheet if: the child has excluded any foreign earned income, deducted a loss from self-employment, or has a net operating loss from another year. Military tax filing Alternate Worksheet for Form 8615, Line 1 A. Military tax filing Enter the amount from the child's Form 1040, line 22, or Form 1040NR, line 23   B. Military tax filing Enter the total of any net loss  from self-employment, any net operating loss deduction, any foreign earned income exclusion, and any foreign housing exclusion from the child's Form 1040 or Form 1040NR. Military tax filing Enter this total as a positive number (greater than zero)   C. Military tax filing Add line A and line B and  enter the total   D. Military tax filing Enter the child's earned income plus any amount from the child's Form 1040, line 30, or the child's Form 1040NR, line 30     Generally, the child's earned income is the total of the amounts reported on Form 1040, lines 7, 12, and 18 (if line 12 or 18 is a loss, use zero) or Form 1040NR, lines 8, 13, and 19 (if line 13 or 19 is a loss, use zero)   E. Military tax filing Subtract line D from line C. Military tax filing Enter the result here and on Form 8615, line 1   Unearned income defined. Military tax filing   Unearned income is generally all income other than salaries, wages, and other amounts received as pay for work actually performed. Military tax filing It includes taxable interest, dividends, capital gains (including capital gain distributions), the taxable part of social security and pension payments, certain distributions from trusts, and unemployment compensation. Military tax filing Unearned income includes amounts produced by assets the child obtained with earned income (such as interest on a savings account into which the child deposited wages). Military tax filing Nontaxable income. Military tax filing   For this purpose, unearned income includes only amounts the child must include in gross income. Military tax filing Nontaxable unearned income, such as tax-exempt interest and the nontaxable part of social security and pension payments, is not included. Military tax filing Capital loss. Military tax filing   A child's capital losses are taken into account in figuring the child's unearned income. Military tax filing Capital losses are first applied against capital gains. Military tax filing If the capital losses are more than the capital gains, the difference (up to $3,000) is subtracted from the child's interest, dividends, and other unearned income. Military tax filing Any difference over $3,000 is carried to the next year. Military tax filing Income from property received as a gift. Military tax filing   A child's unearned income includes all income produced by property belonging to the child. Military tax filing This is true even if the property was transferred to the child, regardless of when the property was transferred or purchased or who transferred it. Military tax filing   A child's unearned income includes income produced by property given as a gift to the child. Military tax filing This includes gifts to the child from grandparents or any other person and gifts made under the Uniform Gift to Minors Act. Military tax filing Example. Military tax filing Amanda Black, age 13, received the following income. Military tax filing Dividends—$800 Wages—$2,100 Taxable interest—$1,200 Tax-exempt interest—$100 Capital gains—$300 Capital losses—($200) The dividends were qualified dividends on stock given to her by her grandparents. Military tax filing Amanda's unearned income is $2,100. Military tax filing This is the total of the dividends ($800), taxable interest ($1,200), and capital gains reduced by capital losses ($300 − $200 = $100). Military tax filing Her wages are earned (not unearned) income because they are received for work actually performed. Military tax filing Her tax-exempt interest is not included because it is nontaxable. Military tax filing Trust income. Military tax filing   If a child is the beneficiary of a trust, distributions of taxable interest, dividends, capital gains, and other unearned income from the trust are unearned income to the child. Military tax filing   However, taxable distributions from a qualified disability trust are considered earned income for the purposes of completing Form 8615. Military tax filing See the Form 8615 instructions for details. Military tax filing Adjustment to income. Military tax filing   In figuring the amount to enter on line 1, the child's unearned income is reduced by any penalty on the early withdrawal of savings. Military tax filing Line 2 (Deductions) If the child does not itemize deductions on Schedule A (Form 1040 or Form 1040NR), enter $2,000 on line 2. Military tax filing If the child itemizes deductions, enter on line 2 the larger of: $1,000 plus the portion of the child's itemized deductions on Schedule A (Form 1040), line 29 (or Schedule A (Form 1040NR), line 15), that are directly connected with the production of the unearned income entered on line 1, or $2,000. Military tax filing Directly connected. Military tax filing   Itemized deductions are directly connected with the production of unearned income if they are for expenses paid to produce or collect taxable income or to manage, conserve, or maintain property held for producing income. Military tax filing These expenses include custodian fees and service charges, service fees to collect taxable interest and dividends, and certain investment counsel fees. Military tax filing    These expenses are added to certain other miscellaneous itemized deductions on Schedule A (Form 1040). Military tax filing Only the amount greater than 2% of the child's adjusted gross income can be deducted. Military tax filing See Publication 529, Miscellaneous Deductions, for more information. Military tax filing Example 1. Military tax filing Roger, age 12, has unearned income of $8,000, no other income, no adjustments to income, and itemized deductions of $300 (net of the 2%-of-adjusted-gross-income limit) that are directly connected with his unearned income. Military tax filing His adjusted gross income is $8,000, which is entered on Form 1040, line 38, and on Form 8615, line 1. Military tax filing Roger enters $2,000 on line 2 because that is more than the total of $1,000 plus his directly-connected itemized deductions of $300. Military tax filing Example 2. Military tax filing Eleanor, age 8, has unearned income of $16,000 and an early withdrawal penalty of $100. Military tax filing She has no other income. Military tax filing She has itemized deductions of $1,050 (net of the 2%-of-adjusted-gross-income limit) that are directly connected with the production of her unearned income. Military tax filing Her adjusted gross income, entered on line 1, is $15,900 ($16,000 − $100). Military tax filing The amount on line 2 is $2,050. Military tax filing This is the larger of: $1,000 plus the $1,050 of directly connected itemized deductions, or $2,000. Military tax filing Line 3 Subtract line 2 from line 1 and enter the result on this line. Military tax filing If zero or less, do not complete the rest of the form. Military tax filing However, you must still attach Form 8615 to the child's tax return. Military tax filing Figure the tax on the child's taxable income in the normal manner. Military tax filing Line 4 (Child's Taxable Income) Enter on line 4 the child's taxable income from Form 1040, line 43; Form 1040A, line 27; or Form 1040NR, line 41. Military tax filing Child files Form 2555 or 2555-EZ. Military tax filing   If the child files Form 2555 or 2555-EZ to claim the foreign earned income exclusion, housing exclusion, or housing deduction, the Foreign Earned Income Tax Worksheet (in the Form 1040 instructions) is used to figure the child's tax. Military tax filing Enter the amount from line 3 of the Foreign Earned Income Tax Worksheet as the child's taxable income on Form 8615, line 4. Military tax filing Line 5 (Net Unearned Income) A child's net unearned income cannot be more than his or her taxable income. Military tax filing Enter on Form 8615, line 5, the smaller of line 3 or line 4. Military tax filing This is the child's net unearned income. Military tax filing If zero or less, do not complete the rest of the form. Military tax filing However, you must still attach Form 8615 to the child's tax return. Military tax filing Figure the tax on the child's taxable income in the normal manner. Military tax filing Step 2. Military tax filing Figuring a Tentative Tax at the Parent's Tax Rate (Form 8615, Part II) The next step in completing Form 8615 is to figure a tentative tax on the child's net unearned income at the parent's tax rate. Military tax filing The tentative tax at the parent's tax rate is the difference between the tax on the parent's taxable income figured with the child's net unearned income (plus the net unearned income of any other child whose Form 8615 includes the tax return information of that parent) and the tax figured without it. Military tax filing When figuring the tentative tax at the parent's tax rate on Form 8615, do not refigure any of the exclusions, deductions, or credits on the parent's return because of the child's net unearned income. Military tax filing For example, do not refigure the medical expense deduction. Military tax filing Figure the tentative tax on Form 8615, lines 6 through 13. Military tax filing Line 6 (Parent's Taxable Income) Enter on line 6 the amount from the parent's Form 1040, line 43; Form 1040A, line 27; Form 1040EZ, line 6; Form 1040NR, line 41; or Form 1040NR-EZ, line 14. Military tax filing If the parent's taxable income is zero or less, enter zero on line 6. Military tax filing Parent files Form 2555 or 2555-EZ. Military tax filing   If the parent files Form 2555 or 2555-EZ to claim the foreign earned income exclusion, housing exclusion, or housing deduction, the Foreign Earned Income Tax Worksheet in the Form 1040 instructions is used to figure the parent's tax. Military tax filing Enter the amount from line 3 of the Foreign Earned Income Tax Worksheet as the parent's taxable income, on line 6 of Form 8615. Military tax filing Line 7 (Net Unearned Income of Other Children) If the tax return information of the parent is also used on any other child's Form 8615, enter on line 7 the total of the amounts from line 5 of all the other children's Forms 8615. Military tax filing Do not include the amount from line 5 of the Form 8615 being completed. Military tax filing (The term “other child” means any other child whose Form 8615 uses the tax information of the parent identified on Lines A and B of Form 8615. Military tax filing ) Example. Military tax filing Paul and Jane Persimmon have three children, Sharon, Jerry, and Mike, who must attach Form 8615 to their tax returns. Military tax filing The children's net unearned income amounts on line 5 of their Forms 8615 are: Sharon—$800 Jerry—$600 Mike—$1,000 Line 7 of Sharon's Form 8615 will show $1,600, the total of the amounts on line 5 of Jerry's and Mike's Forms 8615. Military tax filing Line 7 of Jerry's Form 8615 will show $1,800 ($800 + $1,000). Military tax filing Line 7 of Mike's Form 8615 will show $1,400 ($800 + $600). Military tax filing Other children's information not available. Military tax filing   If the net unearned income of the other children is not available when the return is due, either file the return using estimates or get an extension of time to file. Military tax filing Estimates and extensions are discussed earlier under Providing Parental Information (Form 8615, Lines A–C) . Military tax filing Line 8 (Parent's Taxable Income Plus Children's Net Unearned Income) Enter on this line the total of lines 5, 6, and 7. Military tax filing You must determine the amount of net capital gain and qualified dividends included on this line before completing Form 8615, line 9. Military tax filing Net capital gain. Military tax filing   Net capital gain is the smaller of the gain, if any, on Schedule D (Form 1040), line 15, or the gain, if any, on Schedule D, line 16. Military tax filing If Schedule D is not required, it is the amount on Form 1040, line 13; Form 1040A, line 10; or Form 1040NR, line 14. Military tax filing Qualified dividends. Military tax filing   Qualified dividends are those dividends reported on line 9b of Form 1040 or Form 1040A, or line 10b of Form 1040NR. Military tax filing Net capital gain and qualified dividends on line 8. Military tax filing   If neither the child, nor the parent, nor any other child has net capital gain, the net capital gain on line 8 is zero. Military tax filing   If neither the child, nor the parent, nor any other child has qualified dividends, the amount of qualified dividends on line 8 is zero. Military tax filing   If the child, parent, or any other child has net capital gain, figure the amount of net capital gain included on line 8 by adding together the net capital gain amounts included on lines 5, 6, and 7 of Form 8615. Military tax filing   If the child, parent, or any other child has qualified dividends, figure the amount of qualified dividends included on line 8 by adding together the qualified dividend amounts included on lines 5, 6, and 7. Military tax filing   Use the instructions for Form 8615, line 8, including the appropriate Line 5 Worksheet, to find these amounts. Military tax filing See the instructions for Form 8615 for more details. Military tax filing Note. Military tax filing The amount of any net capital gain or qualified dividends is not separately reported on line 8. Military tax filing It is  needed, however, when figuring the tax on line 9. Military tax filing Line 9 (Tax on Parent's Taxable Income Plus Children's Net Unearned Income) Figure the tax on the amount on line 8 using the Tax Table, the Tax Computation Worksheet, the Qualified Dividends and Capital Gain Tax Worksheet (in the Form 1040, 1040A, or 1040NR instructions), the Schedule D Tax Worksheet (in the Schedule D instructions), or Schedule J (Form 1040), as follows. Military tax filing If line 8 does not include any net capital gain or qualified dividends, use the Tax Table or Tax Computation Worksheet to figure this tax. Military tax filing But if Schedule J, Income Averaging for Farmers and Fishermen, is used to figure the tax on the parent's return, use it to figure this tax. Military tax filing If line 8 includes any net capital gain or qualified dividends, use the Qualified Dividends and Capital Gain Tax Worksheet to figure this tax. Military tax filing For details, see the instructions for Form 8615, line 9. Military tax filing However, if the child, parent, or any other child has 28% rate gain or unrecaptured section 1250 gain, use the Schedule D Tax Worksheet. Military tax filing But if Schedule J is used to figure the tax on the parent's return, use it to figure this tax. Military tax filing Child files Form 2555 or 2555-EZ. Military tax filing   If line 8 includes any net capital gain or qualified dividends and the child, or any other child filing Form 8615, also files Form 2555 or 2555-EZ, use Using the Schedule D Tax Worksheet for line 9 tax, next, to figure the line 9 tax. Military tax filing Using the Schedule D Tax Worksheet for line 9 tax. Military tax filing    Use the Schedule D Tax Worksheet (in the Schedule D instructions) to figure the line 9 tax on Form 8615 if the child, parent, or any other child has unrecaptured section 1250 gain or 28% rate gain. Military tax filing If you must use the Schedule D Tax Worksheet, first complete any Schedule D and any actual Schedule D Tax Worksheet required for the child, parent, or any other child. Military tax filing Then figure the line 9 tax using another Schedule D Tax Worksheet. Military tax filing (Do not attach this Schedule D Tax Worksheet to the child's return. Military tax filing )   Complete this Schedule D Tax Worksheet as follows. Military tax filing On line 1, enter the amount from Form 8615, line 8. Military tax filing On line 2, enter the qualified dividends included on Form 8615, line 8. Military tax filing (See the earlier discussion for line 8. Military tax filing ) On line 3, enter the total of the amounts, if any, on line 4g of all Forms 4952 filed by the child, parent, or any other child. Military tax filing On line 4, enter the total of the amounts, if any, on line 4e of all Forms 4952 filed by the child, parent, or any other child. Military tax filing If applicable, include instead the smaller amount entered on the dotted line next to line 4e. Military tax filing On lines 5 and 6, follow the worksheet instructions. Military tax filing On line 7, enter the net capital gain included on Form 8615, line 8. Military tax filing (See the earlier discussion for line 8. Military tax filing ) On lines 8 through 10, follow the worksheet instructions. Military tax filing On line 11, enter zero if neither the child, nor the parent, nor any other child has unrecaptured section 1250 gain (Schedule D, line 19) or 28% rate gain (Schedule D, line 18). Military tax filing Otherwise, enter the amount of unrecaptured section 1250 gain and 28% rate gain included in the net capital gain on line 8 of Form 8615. Military tax filing Figure these amounts as explained later under Figuring unrecaptured section 1250 gain (line 11) and Figuring 28% rate gain (line 11). Military tax filing If the Foreign Earned Income Tax Worksheet was used to figure the parent's tax or the tax of any child, go to step 10 below. Military tax filing Otherwise, skip steps 10, 11, and 12 below, and go to step 13. Military tax filing Determine whether there is a line 8 capital gain excess as follows. Military tax filing Add the amounts on line 2 of all Foreign Earned Income Tax Worksheets completed by the parent or any child for whom Form 8615 is filed. Military tax filing (But for each child do not add more than the excess, if any, of the amount on line 5 of the child's Form 8615 over the child's taxable income on Form 1040, line 43; Form 1040A, line 27; or Form 1040NR, line 41. Military tax filing ) Subtract (a) from the amount on line 1 of this Schedule D Tax Worksheet. Military tax filing Subtract (b) from the amount on line 10 of this Schedule D Tax Worksheet. Military tax filing If the result is more than zero, that amount is the line 8 capital gain excess. Military tax filing If the result is zero or less, there is no line 8 capital gain excess. Military tax filing If there is no line 8 capital gain excess, skip step 12 below and go to step 13. Military tax filing If there is a line 8 capital gain excess, complete a second Schedule D Tax Worksheet as instructed above and in step 13, but in its entirety and with the following additional modifications. Military tax filing (These modifications are to be made only for purposes of filling out this additional Schedule D Tax Worksheet. Military tax filing ) Reduce the amount you would otherwise enter on line 9 (but not below zero) by the line 8 capital gain excess. Military tax filing Reduce the amount you would otherwise enter on line 6 (but not below zero) by any of the line 8 capital gain excess not used in (a) above. Military tax filing If the child, parent, or any other child has 28% rate gain, reduce the amount you would otherwise enter on line 8 of Worksheet 1 for Line 11 of the Schedule D Tax Worksheet – 28% Rate Gain (Line 9 Tax), shown later, (but not below zero) by the line 8 capital gain excess, and refigure the amount on line 11 of this Schedule D Tax Worksheet. Military tax filing If the child, parent, or any other child has unrecaptured section 1250 gain, reduce the amount you would otherwise enter on line 8 of Worksheet 2 for Line 11 of the Schedule D Tax Worksheet – Unrecaptured Section 1250 Gain (Line 9 Tax) (but not below zero) by the line 8 capital gain excess not used in 12(c), and refigure the amount on line 11 of this Schedule D Tax Worksheet. Military tax filing Complete lines 12 through 45 following the worksheet instructions. Military tax filing Use the parent's filing status to complete lines 15, 42, and 44. Military tax filing Enter the amount from line 45 of this Schedule D Tax Worksheet on Form 8615, line 9, and check the box on that line
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Where to Go for Medical Care

In non-emergency situations, your first choice should be your primary care provider (PCP). Your PCP knows your medical history and treats common ailments. Urgent care is best when you need medical attention for a non-life threatening illness quickly or after regular hours. Go to the emergency room if your illness is serious or life-threatening, such as:

  • Choking
  • Stopped breathing
  • Head injury with passing out, fainting, or confusion
  • Injury to neck or spine, especially if there is loss of feeling or inability to move
  • Electric shock or lightning strike
  • Severe burn
  • Seizure that lasts three to five minutes

MedlinePlus has more information about the differences among health care providers and facilities.

Choosing a Health Care Facility

Report cards on the Internet can help you compare healthcare facilities. Compare doctors and health care facilities at www.healthcare.gov/compare. In addition, private organizations like U.S. News and World Report and Healthgrades.com rate hospitals based on information collected from Medicare records and other sources. As of October 2012, the Affordable Care Act requires all hospitals to report performance publically.

When determining the best health care facility for you, consider these factors:

  • Does the facility accept payment from your insurance plan?
  • Does your doctor have privileges to provide treatment to patients at the facility?
  • What is the quality of the facility?
  • Does the facility specialize in services and procedures that fit with your medical needs?
  • Is the facility in an area you can travel to and from easily? Find health care facilities in your area.

Elder Care and Health Care Facilities Seniors

As people live longer, the need for services for seniors has become more important. The Eldercare Locator (www.eldercare.gov), a public service of the Administration on Aging, U.S. Department of Health and Human Services, is a nationwide service that connects older Americans and their caregivers with information on senior services. Visit www.aoa.gov/Elders_Families for a list of resources to connect older persons, caregivers, and professionals with important federal, national, and local programs.

The Joint Commission on Accreditation of Healthcare Organizations(JCAHO) accredits hospitals as well as nursing homes and other healthcare organizations. Specially trained investigators assess whether these organizations meet set standards. At qualitycheck.org, you can check on a local facility, including how it compares with others. The Joint Commission also accepts consumer complaints. You can post a complaint online.

Naming a Durable Power of Attorney for Health Care

A durable power of attorney for health care (sometimes called a durable medical power of attorney) specifies the person you've chosen to make medical decisions for you. It is activated anytime you're unconscious or unable to make medical decisions. You need to choose someone who meets the legal requirements in your state for acting as your agent. State laws vary, but most states disqualify anyone under the age of 18, your health care provider, or employees of your health care provider.

The person you name as your agent must:

  • Be willing to speak and advocate on your behalf
  • Be willing to deal with conflict among friends and family members, if it arises
  • Know you well and understand your wishes
  • Be willing to talk with you about these issues
  • Be someone you trust with your life

The Military Tax Filing

Military tax filing Index A Asistencia, Cómo Obtener Ayuda con los Impuestos Ayuda, Cómo Obtener Ayuda con los Impuestos Ayuda tributaria, Cómo Obtener Ayuda con los Impuestos B Base ajustada Hoja de Trabajo 1 para calcular, Instrucciones para la Hoja de Trabajo A. Military tax filing H Hojas de Trabajo Base ajustada (Hoja de Trabajo 1), Instrucciones para la Hoja de Trabajo A. Military tax filing I Información de usuarios de equipo TTY/TDD, Cómo Obtener Ayuda con los Impuestos M Más información, Cómo Obtener Ayuda con los Impuestos P Publicaciones, Cómo Obtener Ayuda con los Impuestos S Servicios Tributario Gratuito, Cómo Obtener Ayuda con los Impuestos V Vea la ayuda tributaria, Cómo Obtener Ayuda con los Impuestos Prev  Up     Home   More Online Publications