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Utahtaxhelp org 31. Utahtaxhelp org   Tax on Unearned Income of Certain Children Table of Contents What's New Introduction Useful Items - You may want to see: Which Parent's Return To UseParents Who Do Not File a Joint Return 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. Utahtaxhelp org Figuring the Child's Net Unearned Income (Form 8615, Part I) Step 2. Utahtaxhelp org Figuring Tentative Tax at the Parent's Tax Rate (Form 8615, Part II) Step 3. Utahtaxhelp org Figuring the Child's Tax (Form 8615, Part III) What's New Net Investment Income Tax. Utahtaxhelp org . Utahtaxhelp org  For tax years beginning after December 31, 2012, a child whose tax is figured on Form 8615 may be subject to the Net Investment Income Tax (NIIT). Utahtaxhelp org NIIT is a 3. Utahtaxhelp org 8% tax on the lesser of the net investment income or the excess of the child's modified adjusted gross income (MAGI) over the threshold amount. Utahtaxhelp org Use Form 8960, Net Investment Income Tax, to figure this tax. Utahtaxhelp org For more information on NIIT, go to www. Utahtaxhelp org irs. Utahtaxhelp org gov and enter “Net Investment Income Tax” in the search box. Utahtaxhelp org Introduction This chapter discusses the following two rules that may affect the tax on unearned income of certain children. Utahtaxhelp org 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. Utahtaxhelp org (See Parent's Election To Report Child's Interest and Dividends , later. Utahtaxhelp org ) 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. Utahtaxhelp org (See Tax for Certain Children Who Have Unearned Income , later. Utahtaxhelp org ) For these rules, the term “child” includes a legally adopted child and a stepchild. Utahtaxhelp org These rules apply whether or not the child is a dependent. Utahtaxhelp org Useful Items - You may want to see: Publication 929 Tax Rules for Children and Dependents Form (and Instructions) 8615 Tax for Certain Children Who Have Unearned Income 8814 Parents' Election To Report Child's Interest and Dividends 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. Utahtaxhelp org 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 . Utahtaxhelp org 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. Utahtaxhelp org Only the parent whose tax return is used can make the election described under Parent's Election To Report Child's Interest and Dividends . Utahtaxhelp org Parents are married. Utahtaxhelp org   If the child's parents file separate returns, use the return of the parent with the greater taxable income. Utahtaxhelp org Parents not living together. Utahtaxhelp org   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. Utahtaxhelp org If the custodial parent is not considered unmarried, use the return of the parent with the greater taxable income. Utahtaxhelp org   For an explanation of when a married person living apart from his or her spouse is considered unmarried, see Head of Household in chapter 2. Utahtaxhelp org Parents are divorced. Utahtaxhelp org   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. Utahtaxhelp org Custodial parent remarried. Utahtaxhelp org   If the custodial parent has remarried, the stepparent (rather than the noncustodial parent) is treated as the child's other parent. Utahtaxhelp org Therefore, if the custodial parent and the stepparent file a joint return, use that joint return. Utahtaxhelp org Do not use the return of the noncustodial parent. Utahtaxhelp org   If the custodial parent and the stepparent are married, but file separate returns, use the return of the one with the greater taxable income. Utahtaxhelp org If the custodial parent and the stepparent are married but not living together, the earlier discussion under Parents not living together applies. Utahtaxhelp org Parents never married. Utahtaxhelp org   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. Utahtaxhelp org If the parents did not live together all year, the rules explained earlier under Parents are divorced apply. Utahtaxhelp org Widowed parent remarried. Utahtaxhelp org   If a widow or widower remarries, the new spouse is treated as the child's other parent. Utahtaxhelp org The rules explained earlier under Custodial parent remarried apply. Utahtaxhelp org 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. Utahtaxhelp org If you do, your child will not have to file a return. Utahtaxhelp org You can make this election only if all the following conditions are met. Utahtaxhelp org Your child was under age 19 (or under age 24 if a full-time student) at the end of the year. Utahtaxhelp org Your child had income only from interest and dividends (including capital gain distributions and Alaska Permanent Fund dividends). Utahtaxhelp org The child's gross income was less than $10,000. Utahtaxhelp org The child is required to file a return unless you make this election. Utahtaxhelp org The child does not file a joint return for the year. Utahtaxhelp org 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. Utahtaxhelp org No federal income tax was taken out of your child's income under the backup withholding rules. Utahtaxhelp org You are the parent whose return must be used when applying the special tax rules for children. Utahtaxhelp org (See Which Parent's Return To Use , earlier. Utahtaxhelp org ) These conditions are also shown in Figure 31-A. Utahtaxhelp org Certain January 1 birthdays. Utahtaxhelp org   A child born on January 1, 1995, is considered to be age 19 at the end of 2013. Utahtaxhelp org You cannot make this election for such a child unless the child was a full-time student. Utahtaxhelp org   A child born on January 1, 1990, is considered to be age 24 at the end of 2013. Utahtaxhelp org You cannot make this election for such a child. Utahtaxhelp org Full-time student. Utahtaxhelp org   A full-time student is a child who during some part of each of any 5 calendar months of the year was enrolled as a full-time student at a school, or took a full-time on-farm training course given by a school or a state, county, or local government agency. Utahtaxhelp org A school includes a technical, trade, or mechanical school. Utahtaxhelp org It does not include an on-the-job training course, correspondence school, or school offering courses only through the Internet. Utahtaxhelp org How to make the election. Utahtaxhelp org   Make the election by attaching Form 8814 to your Form 1040. Utahtaxhelp org (If you make this election, you cannot file Form 1040A or Form 1040EZ. Utahtaxhelp org ) Attach a separate Form 8814 for each child for whom you make the election. Utahtaxhelp org You can make the election for one or more children and not for others. Utahtaxhelp org Effect of Making the Election The federal income tax on your child's income may be more if you make the Form 8814 election. Utahtaxhelp org Rate may be higher. Utahtaxhelp org   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. Utahtaxhelp org This is because the tax rate on the child's income between $1,000 and $2,000 is 10% if you make this election. Utahtaxhelp org 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. Utahtaxhelp org Deductions you cannot take. Utahtaxhelp org   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. Utahtaxhelp org The additional standard deduction if the child is blind. Utahtaxhelp org The deduction for a penalty on an early withdrawal of your child's savings. Utahtaxhelp org Itemized deductions (such as your child's investment expenses or charitable contributions). Utahtaxhelp org Reduced deductions or credits. Utahtaxhelp org   If you use Form 8814, your increased adjusted gross income may reduce certain deductions or credits on your return including the following. Utahtaxhelp org Deduction for contributions to a traditional individual retirement arrangement (IRA). Utahtaxhelp org Deduction for student loan interest. Utahtaxhelp org Itemized deductions for medical expenses, casualty and theft losses, and certain miscellaneous expenses. Utahtaxhelp org Credit for child and dependent care expenses. Utahtaxhelp org Child tax credit. Utahtaxhelp org Education tax credits. Utahtaxhelp org Earned income credit. Utahtaxhelp org Penalty for underpayment of estimated tax. Utahtaxhelp org   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. Utahtaxhelp org 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. Utahtaxhelp org See chapter 4 for more information. Utahtaxhelp org Figuring Child's Income Use Form 8814, Part I, to figure your child's interest and dividend income to report on your return. Utahtaxhelp org Only the amount over $2,000 is added to your income. Utahtaxhelp org The amount over $2,000 is shown on Form 8814, line 6. Utahtaxhelp org Unless the child's income includes qualified dividends or capital gain distributions (discussed next), the same amount is shown on Form 8814, line 12. Utahtaxhelp org Include the amount from Form 8814, line 12, on Form 1040, line 21. Utahtaxhelp org Enter “Form 8814” on the dotted line next to line 21. Utahtaxhelp org If you file more than one Form 8814, include the total amounts from line 12 of all your Forms 8814 on Form 1040, line 21. Utahtaxhelp org Capital gain distributions and qualified dividends. Utahtaxhelp org   If your child's dividend income included any capital gain distributions, see Capital gain distributions under Figuring Child's Income in Publication 929, Part 2. Utahtaxhelp org If your child's dividend income included any qualified dividends, see Qualified dividends under Figuring Child's Income in Publication 929, Part 2. Utahtaxhelp org 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. Utahtaxhelp org This tax is added to the tax figured on your income. Utahtaxhelp org This additional tax is the smaller of: 10% × (your child's gross income − $1,000), or $100. Utahtaxhelp org Include the amount from line 15 of all your Forms 8814 in the total on Form 1040, line 44. Utahtaxhelp org Check box a on Form 1040, line 44. Utahtaxhelp org Figure 31-A. Utahtaxhelp org Can You Include Your Child's Income On Your Tax Return? Please click here for the text description of the image. Utahtaxhelp org Figure 31–A. Utahtaxhelp org Can You Include Your Child's Income On Your Tax Return? 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. Utahtaxhelp org 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. Utahtaxhelp org Attach the completed form to the child's Form 1040 or Form 1040A. Utahtaxhelp org When Form 8615 must be filed. Utahtaxhelp org   Form 8615 must be filed for a child if all of the following statements are true. Utahtaxhelp org The child's investment income was more than $2,000. Utahtaxhelp org The child is required to file a return for 2013. Utahtaxhelp org 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. Utahtaxhelp org At least one of the child's parents was alive at the end of 2013. Utahtaxhelp org The child does not file a joint return for 2013. Utahtaxhelp org These conditions are also shown in  Figure 31-B. Utahtaxhelp org Earned income. Utahtaxhelp org   Earned income includes salaries, wages, tips, and other payments received for personal services performed. Utahtaxhelp org It does not include unearned income as defined later in this chapter. Utahtaxhelp org Support. Utahtaxhelp org   Your child's support includes all amounts spent to provide the child with food, lodging, clothing, education, medical and dental care, recreation, transportation, and similar necessities. Utahtaxhelp org To figure your child's support, count support provided by you, your child, and others. Utahtaxhelp org However, a scholarship received by your child is not considered support if your child is a full-time student. Utahtaxhelp org See chapter 3 for details about support. Utahtaxhelp org Certain January 1 birthdays. Utahtaxhelp org   Use the following chart to determine whether certain children with January 1 birthdays meet condition 3 under When Form 8615 must be filed. Utahtaxhelp org Figure 31-B. Utahtaxhelp org Do You Have To Use Form 8615 To Figure Your Child's Tax? Please click here for the text description of the image. Utahtaxhelp org Figure 31-B. Utahtaxhelp org Do You Have To Use Form 8615 To Figure Your Child's Tax?    IF a child was born on. Utahtaxhelp org . Utahtaxhelp org . Utahtaxhelp org THEN, at the end of 2013, the child is considered to be. Utahtaxhelp org . Utahtaxhelp org . Utahtaxhelp org January 1, 1996 18* January 1, 1995 19** January 1, 1990 24*** *This child is not under age 18. Utahtaxhelp org The child meets condition 3 only if the child did not have earned income that was more than half of the child's support. Utahtaxhelp org  **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. Utahtaxhelp org  ***Do not use Form 8615 for this child. Utahtaxhelp org Providing Parental Information (Form 8615, lines A–C) On Form 8615, lines A and B, enter the parent's name and social security number. Utahtaxhelp org (If the parents filed a joint return, enter the name and social security number listed first on the joint return. Utahtaxhelp org ) On line C, check the box for the parent's filing status. Utahtaxhelp org See Which Parent's Return To Use at the beginning of this chapter for information on which parent's return information must be used on Form 8615. Utahtaxhelp org Parent with different tax year. Utahtaxhelp org   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. Utahtaxhelp org Parent's return information not known timely. Utahtaxhelp org   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. Utahtaxhelp org   You can use any reasonable estimate. Utahtaxhelp org This includes using information from last year's return. Utahtaxhelp org If you use an estimated amount on Form 8615, enter “Estimated” on the line next to the amount. Utahtaxhelp org    When you get the correct information, file an amended return on Form 1040X, Amended U. Utahtaxhelp org S. Utahtaxhelp org Individual Income Tax Return. Utahtaxhelp org   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. Utahtaxhelp org S. Utahtaxhelp org Individual Income Tax Return. Utahtaxhelp org Extensions are discussed in chapter 1. Utahtaxhelp org Step 1. Utahtaxhelp org 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. Utahtaxhelp org To do that, use Form 8615, Part I. Utahtaxhelp org Line 1 (unearned income). Utahtaxhelp org   If the child had no earned income, enter on this line the adjusted gross income shown on the child's return. Utahtaxhelp org Adjusted gross income is shown on Form 1040, line 38, or Form 1040A, line 22. Utahtaxhelp org Form 1040EZ cannot be used if Form 8615 must be filed. Utahtaxhelp org   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. Utahtaxhelp org   However, if the child has: excluded any foreign earned income, deducted either a loss from self-employment, or deducted a net operating loss from another year, then use the Alternate Worksheet for Form 8615, Line 1, in Publication 929 to figure the amount to enter on Form 8615, line 1. Utahtaxhelp org Unearned income defined. Utahtaxhelp org   Unearned income is generally all income other than salaries, wages, and other amounts received as pay for work actually done. Utahtaxhelp org It includes taxable interest, dividends (including capital gain distributions), capital gains, unemployment compensation, the taxable part of social security and pension payments, and certain distributions from trusts. Utahtaxhelp org 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). Utahtaxhelp org Nontaxable income. Utahtaxhelp org   For this purpose, unearned income includes only amounts the child must include in total income. Utahtaxhelp org Nontaxable unearned income, such as tax-exempt interest and the nontaxable part of social security and pension payments, is not included. Utahtaxhelp org Income from property received as a gift. Utahtaxhelp org   A child's unearned income includes all income produced by property belonging to the child. Utahtaxhelp org 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. Utahtaxhelp org   A child's unearned income includes income produced by property given as a gift to the child. Utahtaxhelp org This includes gifts to the child from grandparents or any other person and gifts made under the Uniform Gift to Minors Act. Utahtaxhelp org Example. Utahtaxhelp org Amanda Black, age 13, received the following income. Utahtaxhelp org Dividends — $800 Wages — $2,100 Taxable interest — $1,200 Tax-exempt interest — $100 Net capital gains — $100 The dividends were qualified dividends on stock given to her by her grandparents. Utahtaxhelp org Amanda's unearned income is $2,100. Utahtaxhelp org This is the total of the dividends ($800), taxable interest ($1,200), and net capital gains ($100). Utahtaxhelp org Her wages are earned (not unearned) income because they are received for work actually done. Utahtaxhelp org Her tax-exempt interest is not included because it is nontaxable. Utahtaxhelp org Trust income. Utahtaxhelp org   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. Utahtaxhelp org   However, for purposes of completing Form 8615, a taxable distribution from a qualified disability trust is considered earned income, not unearned income. Utahtaxhelp org Line 2 (deductions). Utahtaxhelp org   If the child does not itemize deductions on Schedule A (Form 1040), enter $2,000 on line 2. Utahtaxhelp org   If the child does itemize 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, that are directly connected with the production of unearned income entered on line 1, or $2,000. Utahtaxhelp org Directly connected. Utahtaxhelp org   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. Utahtaxhelp org These expenses include custodian fees and service charges, service fees to collect taxable interest and dividends, and certain investment counsel fees. Utahtaxhelp org   These expenses are added to certain other miscellaneous itemized deductions on Schedule A (Form 1040). Utahtaxhelp org Only the amount greater than 2% of the child's adjusted gross income can be deducted. Utahtaxhelp org See chapter 28 for more information. Utahtaxhelp org Example 1. Utahtaxhelp org 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% limit) that are directly connected with his unearned income. Utahtaxhelp org His adjusted gross income is $8,000, which is entered on Form 1040, line 38, and on Form 8615, line 1. Utahtaxhelp org 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. Utahtaxhelp org Example 2. Utahtaxhelp org Eleanor, age 8, has unearned income of $16,000 and an early withdrawal penalty of $100. Utahtaxhelp org She has no other income. Utahtaxhelp org She has itemized deductions of $1,050 (net of the 2% limit) that are directly connected with the production of her unearned income. Utahtaxhelp org Her adjusted gross income, entered on line 1, is $15,900 ($16,000 − $100). Utahtaxhelp org The amount on line 2 is $2,050. Utahtaxhelp org This is the larger of: $1,000 plus the $1,050 of directly connected itemized deductions, or $2,000. Utahtaxhelp org Line 3. Utahtaxhelp org   Subtract line 2 from line 1 and enter the result on this line. Utahtaxhelp org If zero or less, do not complete the rest of the form. Utahtaxhelp org However, you must still attach Form 8615 to the child's tax return. Utahtaxhelp org Figure the tax on the child's taxable income in the normal manner. Utahtaxhelp org Line 4 (child's taxable income). Utahtaxhelp org   Enter on line 4 the child's taxable income from Form 1040, line 43, or Form 1040A, line 27. Utahtaxhelp org   However, if the child files Form 2555 or 2555-EZ to claim the foreign earned income exclusion, housing exclusion, or housing deduction, see the Form 8615 instructions or Pub. Utahtaxhelp org 929. Utahtaxhelp org Line 5 (net unearned income). Utahtaxhelp org   A child's net unearned income cannot be more than his or her taxable income. Utahtaxhelp org Enter on Form 8615, line 5, the smaller of line 3 or line 4. Utahtaxhelp org This is the child's net unearned income. Utahtaxhelp org   If zero or less, do not complete the rest of the form. Utahtaxhelp org However, you must still attach Form 8615 to the child's tax return. Utahtaxhelp org Figure the tax on the child's taxable income in the normal manner. Utahtaxhelp org Step 2. Utahtaxhelp org Figuring 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. Utahtaxhelp org 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. Utahtaxhelp org 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. Utahtaxhelp org For example, do not refigure the medical expense deduction. Utahtaxhelp org Figure the tentative tax on Form 8615, lines 6 through 13. Utahtaxhelp org Note. Utahtaxhelp org If the child or parent has any capital gains or losses, get Publication 929 for help in completing Form 8615, Part II. Utahtaxhelp org Line 6 (parent's taxable income). Utahtaxhelp org   Enter on line 6 the parent's taxable income from Form 1040, line 43, Form 1040A, line 27, or Form 1040EZ, line 6. Utahtaxhelp org   If the Foreign Earned Income Tax Worksheet (in the Form 1040 instructions) was used to figure the parent's tax, enter the amount from line 3 of that worksheet instead of the parent's taxable income. Utahtaxhelp org Line 7 (net unearned income of other children). Utahtaxhelp org   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. Utahtaxhelp org Do not include the amount from line 5 of the Form 8615 being completed. Utahtaxhelp org Example. Utahtaxhelp org Paul and Jane Persimmon have three children, Sharon, Jerry, and Mike, who must attach Form 8615 to their tax returns. Utahtaxhelp org 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. Utahtaxhelp org Line 7 of Jerry's Form 8615 will show $1,800 ($800 + $1,000). Utahtaxhelp org Line 7 of Mike's Form 8615 will show $1,400 ($800 + $600). Utahtaxhelp org Other children's information not available. Utahtaxhelp org   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. Utahtaxhelp org See Parent's return information not known timely , earlier. Utahtaxhelp org Line 11 (tentative tax). Utahtaxhelp org   Subtract line 10 from line 9 and enter the result on this line. Utahtaxhelp org This is the tentative tax. Utahtaxhelp org   If line 7 is blank, skip lines 12a and 12b and enter the amount from line 11 on line 13. Utahtaxhelp org Also skip the discussion for lines 12a and 12b that follows. Utahtaxhelp org Lines 12a and 12b (dividing the tentative tax). Utahtaxhelp org   If an amount is entered on line 7, divide the tentative tax shown on line 11 among the children according to each child's share of the total net unearned income. Utahtaxhelp org This is done on lines 12a, 12b, and 13. Utahtaxhelp org Add the amount on line 7 to the amount on line 5 and enter the total on line 12a. Utahtaxhelp org Divide the amount on line 5 by the amount on line 12a and enter the result, as a decimal, on line 12b. Utahtaxhelp org Example. Utahtaxhelp org In the earlier example under Line 7 (net unearned income of other children), Sharon's Form 8615 shows $1,600 on line 7. Utahtaxhelp org The amount entered on line 12a is $2,400, the total of the amounts on lines 5 and 7 ($800 + $1,600). Utahtaxhelp org The decimal on line 12b is  . Utahtaxhelp org 333, figured as follows and rounded to three places. Utahtaxhelp org   $800 = . Utahtaxhelp org 333     $2,400   Step 3. Utahtaxhelp org Figuring the Child's Tax (Form 8615, Part III) The final step in figuring a child's tax using Form 8615 is to determine the larger of: The total of: The child's share of the tentative tax based on the parent's tax rate, plus The tax on the child's taxable income in excess of net unearned income, figured at the child's tax rate, or The tax on the child's taxable income, figured at the child's tax rate. Utahtaxhelp org This is the child's tax. Utahtaxhelp org It is figured on Form 8615, lines 14 through 18. Utahtaxhelp org Alternative minimum tax. Utahtaxhelp org   A child may be subject to alternative minimum tax (AMT) if he or she has certain items given preferential treatment under the tax law. Utahtaxhelp org See Alternative Minimum Tax (AMT) in chapter 30. Utahtaxhelp org    For more information on who is liable for AMT and how to figure it, see Form 6251, Alternative Minimum Tax—Individuals. Utahtaxhelp org For information on special limits that apply to a child who files Form 6251, see Certain Children Under Age 24 in the Instructions for Form 6251. Utahtaxhelp org Prev  Up  Next   Home   More Online Publications
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Choosing a Credit Counseling Agency

Counseling services are available to help people budget money and pay bills. Credit unions, Cooperative Extension offices, military family service centers and religious organizations are among those that may offer free or low-cost credit counseling.

Local, nonprofit agencies that provide educational programs on money management and help in developing debt payment plans operate under the name Consumer Credit Counseling Service (CCCS). Make certain that the agency is accredited by the Council on Accreditation, (COA), or the International Organization for Standardization (ISO). The counselor should also be certified by the National Foundation for Credit Counseling (NFCC), an organization that supports a national network of credit counselors.

Typically, a counseling service will negotiate lower payments with your creditors, then make the payments using money you send to it each month. The cost of setting up this debt-management plan is paid by the creditor, not you. Ask these questions to find the best counselor for you:

  • What services do you offer? Look for an organization that offers budget counseling and money management classes as well as a debt-management plan.
  • Do you offer free information? Avoid organizations that charge for information or make you provide a lot of details about your problem first.
  • What are your fees? Are there set-up and/or monthly fees? A typical set-up fee is $10. Beware of agencies that charge large up-front fees.
  • How will the debt management plan work? What debts can be included in the plan and will you get regular reports on your accounts?
  • Ask whether the counselor can get creditors to lower or eliminate interest and fees. If the answer is yes, contact your creditors to verify this.
  • Ask what happens if you can't afford to pay. If an organization won't help you because you can't afford to pay, go somewhere else for help.
  • Will your counselor help you avoid future problems? Getting a plan for avoiding future debt is as important as solving the immediate debt problem.
  • Ask for a contract. All verbal promises should be in writing before you pay any money.
  • Are your counselors accredited or certified? Legitimate credit counseling firms are affiliated with the National Foundation for Credit Counseling or the Association of Independent Consumer Credit Counseling Agencies.

Check with your local consumer protection agency and the Better Business Bureau to see if any complaints have been filed about the counseling service you're considering.

If you have concerns about approved credit counseling agencies or credit counseling providers, please contact the U.S. Trustee Program .

The Utahtaxhelp Org

Utahtaxhelp org Part One -   Fuel Taxes and Fuel Tax Credits and Refunds Chapter 1 defines the types of fuel, taxable events, and exemptions or exceptions to the fuel taxes. Utahtaxhelp org Chapter 2 provides information on, and definitions of, the nontaxable uses and explains how to make a claim. Utahtaxhelp org Table of Contents 1. Utahtaxhelp org   Fuel TaxesDefinitions Information Returns Registration RequirementsAdditional information. Utahtaxhelp org Gasoline and Aviation GasolineTaxable Events Gasoline Blendstocks Diesel Fuel and KeroseneTaxable Events Dyed Diesel Fuel and Dyed Kerosene Alaska and Feedstocks Back-up Tax Diesel-Water Fuel Emulsion Kerosene for Use in AviationTaxable Events Liability For Tax Surtax on any liquid used in a fractional ownership program aircraft as fuel Certificate for Commercial Aviation and Exempt UsesExempt use. Utahtaxhelp org Reseller statement. Utahtaxhelp org Other Fuels (Including Alternative Fuels)Taxable Events Compressed Natural Gas (CNG)Taxable Events Fuels Used on Inland WaterwaysFishing vessels. Utahtaxhelp org Deep-draft ocean-going vessels. Utahtaxhelp org Passenger vessels. Utahtaxhelp org Ocean-going barges. Utahtaxhelp org State or local governments. Utahtaxhelp org Cellulosic or Second Generation Biofuel Not Used as Fuel Biodiesel Sold as But Not Used as Fuel 2. Utahtaxhelp org   Fuel Tax Credits and RefundsGasoline and Aviation Gasoline Undyed Diesel Fuel and Undyed Kerosene (Other Than Kerosene Used in Aviation)Sales by Registered Ultimate Vendors Diesel-Water Fuel Emulsion Kerosene for Use in AviationSales by Registered Ultimate Vendors Other Fuels (Including Alternative Fuels) Refunds of Second TaxOptional reporting. Utahtaxhelp org Providing information. Utahtaxhelp org Definitions of Nontaxable UsesCustom application of fertilizer and pesticide. Utahtaxhelp org Fuel used between airfield and farm. Utahtaxhelp org Fuel not used for farming. Utahtaxhelp org Vehicles not considered highway vehicles. Utahtaxhelp org Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture CreditHow to Claim the Credit Filing Claims Claiming A Refund Claiming a Credit on Form 4136 Including the Credit or Refund in Income Prev  Up  Next   Home   More Online Publications