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Estate planning often involves lifetime gifts to children. This gets appreciation on the assets out of the parents' estates. This was also done in the past to shift income to children who were usually in a lower tax bracket. Now a child under 18 pays tax at the parents' highest marginal tax rate on the child's unearned income over $1900 if that would be higher than the child's tax. The tax also applies if the child's earned income does not exceed one-half of the child's support and the child is 18 or is a full time student aged 19-23. || Back
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Donald M.
Thompson * 55 W. Monroe #3950; Chicago, IL 60603 |
