IRS Form 8615 – In the world of taxes, the “kiddie tax” is a key rule designed to prevent parents from shifting income to their children to take advantage of lower tax rates. Officially known as IRS Form 8615 – Tax for Certain Children Who Have Unearned Income, this form calculates taxes on a child’s unearned income that exceeds a specific threshold. For the 2025 tax year, if your child has more than $2,700 in unearned income, you may need to file this form to ensure the income is taxed appropriately—often at the parent’s higher tax rate. Understanding Form 8615 can help families avoid surprises during tax season and comply with IRS requirements. This guide breaks down everything you need to know, including eligibility, calculations, and how to download the form.
What Is IRS Form 8615 and the Kiddie Tax?
The kiddie tax, introduced in 1986, applies to unearned income of minors and certain young adults. Its purpose is to tax investment income and other passive earnings at the parent’s marginal tax rate if it’s higher than the child’s rate, discouraging income-shifting strategies. Form 8615 is the IRS document used to figure this tax.
For 2025, the rules are straightforward:
- The first $1,350 of a child’s unearned income is tax-free (standard deduction).
- The next $1,350 is taxed at the child’s rate (typically 10% for most).
- Any unearned income over $2,700 is taxed at the parent’s rate.
This threshold is adjusted annually for inflation; for 2024, it was $2,600, and it remains $2,700 for 2025. The form must be attached to the child’s Form 1040 or 1040-NR tax return.
Who Needs to File Form 8615?
Not every child with income needs to file Form 8615. The IRS requires it only if all of the following conditions are met:
- The child had more than $2,700 in unearned income for 2025.
- The child is required to file a tax return (generally if gross income exceeds the standard deduction).
- The child meets one of these age criteria at the end of 2025:
- Under age 18,
- Age 18 but earned income was not more than half of their support, or
- A full-time student age 19 to 23 (under 24) and earned income was not more than half of their support.
- At least one parent was alive at the end of 2025.
- The child does not file a joint tax return for 2025.
“Child” includes biological, adopted, or stepchildren, regardless of dependency status. Support includes food, housing, education, and medical costs—scholarships don’t count for full-time students. If neither parent is alive, or if the child files jointly, Form 8615 doesn’t apply.
Special note for birthdays: A child born on January 1, 2008, is considered 18 for 2025 purposes, so they qualify only under the support rule.
What Counts as Unearned Income for the Kiddie Tax?
Unearned income is any earnings not from active work. Common examples include:
- Taxable interest and dividends.
- Capital gains distributions.
- Rents, royalties, and partnership income.
- Pension or annuity payments.
- Taxable scholarships or fellowships.
- Unemployment compensation or alimony.
- Income from trusts (except earned portions).
Earned income, like wages from a job, is excluded. Capital losses can offset gains, with up to $3,000 excess reducing other unearned income. Nontaxable items, such as tax-exempt interest or gifts under $18,000 (2025 gift tax exclusion), don’t count.
How to Calculate the Tax on Form 8615: Step-by-Step Guide?
Filling out Form 8615 involves comparing the child’s tax at their rate versus the parent’s. Here’s a simplified step-by-step based on the 2025 instructions:
- Enter Parent’s Information (Lines A-C): Provide the parent’s name, SSN, and filing status. Use the joint return if married filing jointly; otherwise, the parent with higher taxable income (or custodial parent in divorce cases).
- Child’s Net Unearned Income (Part I):
- Line 1: Enter the child’s unearned income (use the Child’s Unearned Income Worksheet if needed).
- Line 2: $2,700 (or adjusted if itemizing deductions like investment fees; note: miscellaneous deductions are suspended through 2025).
- Line 3: Subtract Line 2 from Line 1.
- Line 4: Child’s taxable income from Form 1040, line 15.
- Line 5: Smaller of Line 3 or Line 4 (net unearned income).
- Tentative Tax at Parent’s Rate (Lines 6-13):
- Add the child’s net unearned income to the parent’s taxable income.
- Calculate tax on this combined amount using the parent’s rate (Tax Table, Qualified Dividends Worksheet, etc.).
- Subtract the parent’s standalone tax to find the incremental tax.
- If multiple children, allocate proportionally.
- Child’s Tax (Lines 14-18):
- Subtract net unearned from child’s taxable income.
- Tax the remainder at the child’s rate.
- Add the tentative tax from parent’s rate.
- Compare to tax at child’s rate alone; use the higher amount.
Enter the final tax on the child’s Form 1040, line 16. Consider Alternative Minimum Tax (Form 6251) or Net Investment Income Tax (Form 8960, 3.8% on excess income).
If parents’ info changes after filing, amend with Form 1040-X.
Alternatives to Form 8615: Using Form 8814
Parents can elect to report the child’s income on their own return using Form 8814 if the child’s unearned income is $13,500 or less (mostly interest/dividends) and no estimated taxes were paid. This simplifies filing but may result in higher taxes since it’s all at the parent’s rate. No separate child return is needed.
Updates and Changes for the 2025 Tax Year
The 2025 thresholds remain $2,700 for unearned income, with no major legislative changes noted as of January 2026. Miscellaneous itemized deductions stay suspended. Check IRS.gov for post-publication updates, as the page was last reviewed on January 23, 2026. For 2026, thresholds are expected to hold at similar levels, but always verify.
How to Download IRS Form 8615?
You can download the latest PDF version of Form 8615 directly from the IRS website. Here’s the link: Download IRS Form 8615 PDF. For instructions, visit IRS Instructions for Form 8615.
Frequently Asked Questions About Form 8615
What if my child has both earned and unearned income?
Only unearned income over $2,700 triggers the kiddie tax; earned income is taxed at the child’s rate.
Can the kiddie tax apply to college students?
Yes, for full-time students under 24 if earned income doesn’t cover more than half their support.
What if I can’t get the parent’s tax info?
Request an extension with Form 4868, then ask the IRS for the data after the tax year.
Is there a way to avoid the kiddie tax?
Invest in tax-advantaged accounts like 529 plans or Roth IRAs, where growth may be tax-free or deferred.
Conclusion
Navigating IRS Form 8615 and the kiddie tax rules ensures your family’s investments are taxed fairly. By understanding who must file, what income qualifies, and how to calculate the tax, you can prepare accurately for the 2025 tax year. Always consult a tax professional for personalized advice, and stay updated via IRS resources. Filing correctly not only avoids penalties but also maximizes your financial planning.