Kiddie Tax Calculator (Form 8615)

How the 2026 kiddie tax is calculated

The kiddie tax (IRC §1(g)) stops families from shifting investment income to a child who sits in a lower bracket. For 2026 it splits a child's unearned income into three tiers: the first $1,350 is absorbed by the dependent standard deduction and is untaxed, the next $1,350 is taxed at the child's own rate, and everything above $2,700 is taxed at the parent's marginal rate.

The $2,700 line is not arbitrary. It is exactly twice the $1,350 dependent standard deduction floor set in Rev. Proc. 2025-32, which is why the two lower tiers are each $1,350 wide. Both figures are unchanged from 2025.

A worked example: a 15-year-old with $8,000 of ordinary dividends and no wages. Her standard deduction is $1,350 (the floor, since she has no earned income), so her taxable income on line 4 is $6,650. Line 3, unearned income over $2,700, is $5,300. Line 5, net unearned income, is the smaller of those two: $5,300. That $5,300 stacks on top of the parent's taxable income, and the extra tax it produces at the parent's rates lands on line 13. The remaining $1,350 (line 14) is taxed at the child's 10% single rate for $135 on line 15.

Line 16 adds lines 13 and 15. Line 17 is what the tax would have been if the whole $6,650 had been taxed at the child's own rates. Line 18, the number the child actually owes, is the larger of line 16 and line 17. That last step is the part most explainers skip, and it matters: when the parent's marginal rate is at or below the child's, line 17 wins and the kiddie tax adds nothing at all. The calculator reports that case as $0 of extra tax rather than inventing a penalty.

Who the kiddie tax applies to (and who escapes it)

Three age tests bring a child into Form 8615. Two of them turn on the same support test.

The support test is the usual escape hatch. A 20-year-old student who covers more than half of her own support with a job files at her own rates no matter how large her portfolio is. Support means the total cost of her living expenses for the year, not just what she spent from wages, so scholarships and parental housing count toward the other side of the ledger.

Two more conditions apply to every case. At least one parent must be alive at the end of the year, and the child must not file a joint return with a spouse. Fail either and the kiddie tax is off, whatever the child's age. See who counts as a dependent in 2026 for the related support and residency rules on the parent's side.

Form 8615 vs. Form 8814: which one to file

Form 8615 is the default. It attaches to the child's own Form 1040 and computes the child's tax using the parent's rate on the top tier. Form 8814 is an election that lets the parent skip the child's return entirely by reporting the child's income on the parent's own 1040.

The election is narrow. Every one of these must be true: the child has no earned income, the unearned income is only interest, dividends, and capital-gain distributions, gross income is under $13,500, no estimated tax was paid in the child's name, and no backup withholding applies. Miss one and Form 8615 is the only route.

When it is available, the cost is the parent's marginal rate applied to the child's income above $2,700, plus a separate tax of 10% on the second tier that tops out at exactly $135. That $135 cap is easy to overshoot: 10% of everything above $1,350 is the wrong formula, because the tier itself is only $1,350 wide.

On federal tax alone the two routes come out the same. A child eligible for the election has no earned income and gross income under $13,500, so the child's taxable income can never clear the $12,400 top of the 10% single bracket. That pins line 15 at exactly $135, the same figure as the second-tier tax, and leaves line 13 equal to the extra tax the parent would owe under the election. The calculator will normally report the comparison as a wash.

The real cost of the election never shows up on the form. Adding the child's income to the parent's return raises the parent's AGI, which can shrink AGI-sensitive credits and deductions and push the parent closer to the net investment income tax threshold. It also gives up the child's own return as a place to claim withholding or estimated payments. What the election buys is simplicity, one return instead of two, and the card above prices the federal side so you can weigh that against the AGI effects.

When this estimate may not apply

This calculator treats all unearned income as ordinary-rate income. Form 8615 line 9 routes through the Qualified Dividends and Capital Gain Tax Worksheet when the child or parent has qualified dividends or net long-term capital gains, and through the Schedule D Tax Worksheet when there is 28%-rate gain or unrecaptured §1250 gain. Neither worksheet is modeled here, so the estimate runs high when the child's income is mostly preferential-rate income. For that case, start with the capital gains tax calculator and the 2026 capital gains rates.

A few other limits worth knowing. When several children file Form 8615 against the same parent, they share the parent's tentative tax in proportion to their net unearned income, which is what the advanced sibling field handles. Divorced or separated parents use the custodial parent's return, and married parents filing separately use whichever has the higher taxable income, neither of which is an input here. State rules differ: some states piggyback on the federal computation, others ignore it, and none of that is modeled. The tax bracket calculator is the fastest way to confirm the parent's marginal rate before you trust the line 13 figure, and the 529 plan tax savings calculator covers the account type most families use to sidestep the kiddie tax altogether.

These figures are estimates for the 2026 tax year based on IRS Rev. Proc. 2025-32 and the Instructions for Forms 8615 and 8814. They are not tax or legal advice. Check your own numbers with a tax professional before filing.