2018 Tax Law Changes

For tax years beginning after December 31, 2017 the taxable income of a child attributable to net unearned income (the “Kiddie Tax”) will be taxed according to the brackets applicable to trusts and estates. Beginning in 2018 (and continuing until 2026), Trusts and Estates will be subject to four tax brackets (10%, 24%, 35% and 37%) with the highest bracket applying to taxable income in excess of $12,500. No longer is the tax status of the child’s parent(s) applicable in determining the tax on net unearned income of the child. The earned income of the child will continue to be taxed as regular ordinary income rates applicable to a single individual.