2020 Kiddie Tax Threshold
For 2020, the Kiddie Tax Threshold figures are $1,100 (Unearned income reduction amount) and $2,200 (Unearned income filing trigger).
Effective 2020-01-01Source: Rev. Proc. 2019-44 (IRS)Verified 2026-09-03
Unearned income filing triggerSource: 2020 Instructions for Form 8615, Tax for Certain Children Who Have Unearned Income (IRS)Verified 2026-09-03
Compared with 2019
Every figure on this page is unchanged from 2019.
| Item | 2019 | 2020 | Change |
|---|---|---|---|
| Unearned income reduction amount | $1,100 | $1,100 | +$0 (+0.0%) |
| Unearned income filing trigger | $2,200 | $2,200 | +$0 (+0.0%) |
Who it applies to
Children subject to the 'kiddie tax' under Internal Revenue Code § 1(g) and their parents for taxable years beginning in 2020.
What changed this year, and why
For taxable years beginning in 2020, the unearned income threshold under § 1(g)(4)(A)(ii)(I) - the amount used to reduce the net unearned income reported on a child's return that is subject to the 'kiddie tax' - is $1,100. The same $1,100 amount is used for purposes of § 1(g)(7), which determines whether a parent may elect to include a child's gross income in the parent's gross income and to calculate the kiddie tax.
Common questions
- What is the kiddie tax unearned income threshold for 2020?
- The threshold is $1,100. This amount reduces the net unearned income reported on the child's return that is subject to the kiddie tax. The same amount is also used to determine whether a parent may elect to include a child's gross income in the parent's gross income and to calculate the kiddie tax.
The five conditions, and the three age tests
All five conditions have to hold together, so the usual way out of Form 8615 is one of them failing rather than the list as a whole. The money condition is unearned income above $2,200 for 2020; below that, none of the rest matters. The filing condition is separate and easy to miss - a child with no obligation to file a return at all does not file this form either. Age is the third, and it is really three tests in one. Being under 18 at the end of 2020 catches a child outright. An 18-year-old, or a full-time student who is at least 19 and under 24, is caught only where their own earnings did not cover over half of what it cost to support them, which is a test a working young adult can fail on purpose and a student living at home almost never fails. The last two conditions are about the family rather than the child: one parent must have been living when 2020 closed, because the tax is worked out by reference to a parent, and the child must not be filing jointly for the year, because a joint filer is already taxed as part of a couple.
Form 8615 must be filed for any child who meets all of the following conditions. 1. The child had more than $2,200 of unearned income. 2. The child is required to file a tax return. 3. The child either: a. Was under age 18 at the end of 2020, b. Was age 18 at the end of 2020 and didn’t have earned income that was more than half of the child's support, or c. Was a full-time student at least age 19 and under age 24 at the end of 2020 and didn’t have earned income that was more than half of the child's support. (Earned income is defined later. Support is defined below.) 4. At least one of the child's parents was alive at the end of 2020. 5. The child doesn’t file a joint return for 2020.
2020 Instructions for Form 8615, Tax for Certain Children Who Have Unearned Income (IRS)
What counts as unearned income
The definition works by subtraction, not by enumeration: for this form, taxable income that is not earned income is unearned. The examples are illustrative, so a receipt that none of them names is still unearned if it is taxable and is not pay for work. Investment income is the obvious part - ordinary dividends, taxable interest, royalties, rents, and capital gains including the distributions a fund pays out. The entries that catch people out are the ones that feel like earnings or like benefits. A taxable scholarship or fellowship grant that no Form W-2 reports is unearned. So are pension and annuity payments, taxable social security, alimony, unemployment compensation, and what a child takes as a trust beneficiary other than earned income. Two things follow. A child who never worked a day can still hold enough of this income to be pushed into the calculation, because none of it requires a job. And it is where the money came from, not how much of it there is, that decides which side of the line it falls on.
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.
2020 Instructions for Form 8615, Tax for Certain Children Who Have Unearned Income (IRS)
The support test that decides whether an older child is caught
Support includes all amounts spent to provide the child with food, lodging, clothing, education, medical and dental care, recreation, transportation, and similar necessities. To determine the child's total support, you count support provided by you, the child, and others. A scholarship received by a full-time student does not count as support. This matters for children who are age 18 or who are full-time students age 19 to 23: they are subject to Form 8615 only if their earned income was not more than half of their own support for the year.
Support. Your support includes all amounts spent to provide the child with food, lodging, clothing, education, medical and dental care, recreation, transportation, and similar necessities. To figure your child’s support, count support provided by you, your child, and others. However, a scholarship received by your child isn’t considered support if your child is a full-time student.
2020 Instructions for Form 8615, Tax for Certain Children Who Have Unearned Income (IRS)
Reporting the child's income on the parent's return instead
There is a route by which the child's investment income never reaches a child's return at all. The parent's own return picks up the child's interest, capital gain distributions and ordinary dividends, and once the election is made the child files nothing: no return, and no Form 8615 with it. What is bought is simplicity, and it is not free. The same income sitting on the parent's return can carry more federal income tax than it would have carried on the child's, and that is true in particular of qualified dividends and of capital gain distributions, which can lose on a parent's return the gentler treatment they had in the child's hands. So the election is worth costing out both ways rather than assumed to be the cheaper answer. Its reach is narrow too: capital gain distributions, ordinary dividends and interest are all it can carry, so a child with other kinds of unearned income cannot be swept onto a parent's return this way. Form 8814 is where the election and its conditions are set out.
The parent may be able to elect to report the child’s interest, ordinary dividends, and capital gain distributions on the parent’s return. If the parent makes this election, the child won’t have to file a return or Form 8615. However, the federal income tax on the child’s 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.
2020 Instructions for Form 8615, Tax for Certain Children Who Have Unearned Income (IRS)
Why the child's own bracket is not the end of it
For children under age 18 and certain older children who meet the Who Must File conditions, unearned income over $2,200 is taxed at the parent's rate if the parent's rate is higher than the child's. This is the central purpose of Form 8615: even though the child may be in a lower tax bracket on their own return, the portion of unearned income above $2,200 is effectively taxed at whichever is higher - the child's rate or the parent's rate. If the child's unearned income exceeds $2,200, the form is used to compute the tax. The $1,100 threshold is the standard deduction component applied before the excess is determined.
For children under age 18 and certain older children described below in Who Must File, unearned income over $2,200 is taxed at the parent's rate if the parent's rate is higher than the child's. If the child's unearned income is more than $2,200, use Form 8615 to figure the child's tax.
2020 Instructions for Form 8615, Tax for Certain Children Who Have Unearned Income (IRS)
If a parent's income later changes, the child's tax has to be refigured
Under the 2020 kiddie tax rules, if a parent's income changes after the child's return is filed, the child's tax must be refigured using the adjusted amounts. This means that the original calculation based on the parent's income at the time of filing is no longer valid, and a new computation must be done with the correct figures. The same rule applies if there are changes to the net unearned income of other children for whom the parent must file Form 8615. When the child's tax changes as a result of these adjustments, the parent or child must file Form 1040-X, the Amended U.S. Individual Income Tax Return, to correct the child's tax. This provision ensures that the kiddie tax calculation accurately reflects the parent's actual income and the income of all children subject to the tax, even when information was not available or was estimated at the time the original return was filed.
If the parent’s income changes after the child’s return is filed, the tax must be refigured using the adjusted amounts.
2020 Instructions for Form 8615, Tax for Certain Children Who Have Unearned Income (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Rev. Proc. 2019-44 (IRS)
- Unearned income reduction amount
For taxable years beginning in 2020, the amount in § 1(g)(4)(A)(ii)(I), which is used to reduce the net unearned income reported on the child's return that is subject to the "kiddie tax," is $1,100.
2020 Instructions for Form 8615, Tax for Certain Children Who Have Unearned Income (IRS)
- Unearned income filing trigger
1. The child had more than $2,200 of unearned income.