Head of Household, 23 year-old student, unemployment and Kiddie Tax!!

[jhbvtacpa]

Here's a new one for TY2020!!

Single mom makes $95K. Her 23 year-old son was a full-time student who graduated during TY2020. He had $18k in unemployment and $500 in wages.

Mom says she still provided over 50% of his support, so she should be able to claim H of H. Is the kid going to be subject to Kiddie Tax on the unearned income?

[BobKamman]

Only on $7,800 of it?  

Actually, even less than that, but I forget the amount where Kiddie Tax kicks in.

He still qualifies her for the $1,400 EIP3, so I think the family comes out ahead.  

[jhbvtacpa]

That's what I'm thinking, the $7,800 less the $2,200 exclusion kicks $5,600 into Kiddie Tax land.

Just seems crazy that the unemployment comes into play!