Comments on: What Is The Kiddie Tax And How Does It Work? https://thecollegeinvestor.com/35257/what-is-the-kiddie-tax/ Navigating Money And Education Mon, 01 Jan 2024 18:57:08 +0000 hourly 1 By: Robert Farrington https://thecollegeinvestor.com/35257/what-is-the-kiddie-tax/#comment-477734 Tue, 25 Jul 2023 22:30:18 +0000 https://thecollegeinvestor.com/?p=35257#comment-477734 In reply to Ambel Sandel.

For tax purposes, you would need to provide more than half their support. Doesn’t sound like you do. So you don’t need to claim them as a dependent. For FAFSA, an independent student is someone who will not receive any financial support for their education from their parents or guardians. Sounds like they are independent for that as well.

]]> By: Ambel Sandel https://thecollegeinvestor.com/35257/what-is-the-kiddie-tax/#comment-477732 Tue, 25 Jul 2023 21:49:07 +0000 https://thecollegeinvestor.com/?p=35257#comment-477732 My 19-year old son is a full-time student studying abroad, at an institution that is not eligible for the federal student loans program. He wants to fund his living & education expenses from a traditional inherited IRA account, established in 2016 (before SECURE Act of 2019). He will have no earned income, only the unearned income from the inherited IRA. As his parents, do we need to continue to claim him as a dependent when he is no longer living with us and studying at a school not recognized by the US for FAFSA / participating in federal student loans?

]]> By: Robert Farrington https://thecollegeinvestor.com/35257/what-is-the-kiddie-tax/#comment-473451 Thu, 01 Sep 2022 20:14:14 +0000 https://thecollegeinvestor.com/?p=35257#comment-473451 In reply to Molly Evans.

It depends on your state. Some states allow this, some do not. See this guide: Using a 529 plan to pay for K-12 tuition.

]]> By: Molly Evans https://thecollegeinvestor.com/35257/what-is-the-kiddie-tax/#comment-473449 Thu, 01 Sep 2022 19:15:31 +0000 https://thecollegeinvestor.com/?p=35257#comment-473449 I would like to make a $1700 distribution from our 529 account to our son’s saving account to help pay for middle school tuition. As I understand, this amount is not considered unearned income and will not be taxed. Do I have this correct? Many thanks. 

]]> By: Robert Farrington https://thecollegeinvestor.com/35257/what-is-the-kiddie-tax/#comment-464855 Tue, 11 May 2021 21:25:02 +0000 https://thecollegeinvestor.com/?p=35257#comment-464855 In reply to MS BARBARA MILLS.

No, distributions from a 529 plan are not subject to the Kiddie Tax.

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