Appendix Five

• Author: Brian C. Vertz and Mitchell E. Benson
• Pages: 426-435

Appendix Five Divorce Taxation A-16

APPENDIX FIVE

ΙΡΣ Φορµ 8615, Ταξ φορ Χερταιν Χηιλδρεν

Ωηο Ηαϖε Υνεαρνεδ Ινχοµε, ωιτη Ινστρυχτιονσ

2019

Instructions for Form 8615

Tax for Certain Children Who Have Unearned Income (Rev. January 2020)

Department of the Treasury

Internal Revenue Service

Section references are to the Internal Revenue Code unless

otherwise noted.

Future Developments

For the latest information about developments related to Form

8615 and its instructions, such as legislation enacted after they

were published, go to IRS.gov/Form8615.

What’s New

Election to modify the tax on your unearned income.

Recent legislation has modified for 2019 (and retroactively for

2018) the rules related to the tax for certain children who have

unearned income to allow you to elect to calculate your tax

based on the tax rate of your parent. For tax year 2019, you can

elect this alternative application for the tax on your unearned

income. You will complete Form 8615 differently depending on

your election. See the instructions for Part II Tax, later, for more

information.

If you make this election for 2019, include a statement with

your return specifying “election to modify tax of unearned

income.” The statement can be made on the return (for example,

on line 7 or at the top of Form 8615) or on an attachment filed

with the return.

For tax year 2018, if you choose to modify the tax on your

unearned income using the tentative tax based on the tax rate of

your parent, you will need to use the 2018 Instructions for Form

8615 and file an amended return, Form 1040-X. See IRS.gov/

Form1040X for more information about amending a tax return. If

you make this election, include a statement or an attachment

with your amended return specifying “election to modify tax of

unearned income.”

Reminder

Change in tax rates. The Tax Cuts and Jobs Act of 2017

modified the tax rates and brackets used to figure the tax on

2019 unearned income for certain children. Unless you elect to

calculate your tax based on the tax rate of your parent, all net

unearned income over a threshold amount of $2,200 for 2019

will be taxed using the brackets and rates for estates and trusts.

General Instructions

Purpose of Form

Use Form 8615 to figure your tax on unearned income over

$2,200 if you are under age 18, and in certain situations if you

are older. See Who Must File, later.

Unearned Income

For Form 8615, “unearned income” includes all taxable income

other than earned income. Unearned income includes taxable

interest, ordinary dividends, capital gains (including capital gain

distributions), rents, royalties, etc. It also includes taxable social

security benefits, pension and annuity income, taxable

scholarship and fellowship grants not reported on Form W-2,

unemployment compensation, alimony, and income (other than

earned income) received as the beneficiary of a trust.

Who Must File

Form 8615 must be filed for anyone who meets all of the

following conditions.

1. You had more than $2,200 of unearned income.

2. You are required to file a tax return.

3. You were either:

a. Under age 18 at the end of 2019,

b. Age 18 at the end of 2019 and didn’t have earned income

that was more than half of your support, or

c. A full-time student at least age 19 and under age 24 at the

end of 2019 and didn’t have earned income that was more than

half of your support.

(Earned income is defined later. Support is defined below.)

4. At least one of your parents was alive at the end of 2019.

5. You don’t file a joint return for 2019.

These rules apply if you’re legally adopted or a stepchild.

These rules also apply whether or not you’re a dependent.

These rules don’t apply if neither of your parents were living at

the end of the year.

Support. Your support includes all amounts spent to provide

you with food, lodging, clothing, education, medical and dental

care, recreation, transportation, and similar necessities. To

figure your support, count support provided by you, your

parents, and others. However, a scholarship you received isn’t

considered support if you’re a full-time student. For details, see

Pub. 501, Dependents, Standard Deduction, and Filing

Information.

Certain January 1 birthdays. Use the following chart to

determine whether you meet condition 3 under Who Must File,

earlier, for certain January 1 birthdays.

IF you were born on... THEN, at the end of 2019,

you are considered to be...

January 1, 2002 18*

January 1, 2001 19**

January 1, 1996 24***

*You aren’t under age 18. You meet condition 3 only if you didn’t

have earned income that was more than half of your support.

**You meet condition 3 only if you were a full-time student who didn’t

have earned income that was more than half of your support.

***Don’t use Form 8615.

Your parent may be able to elect to report your interest,

ordinary dividends, and capital gain distributions on his

or her return. If your parent makes this election, you

won’t have to file a return or Form 8615. However, the federal

income tax on your income, including qualified dividends and

capital gain distributions, may be higher if this election is made.

For more details, see Form 8814, Parents’ Election To Report

Child's Interest and Dividends.

TIP

Jan 30, 2020 Cat. No. 28914R

APPENDIX FIVE