Form 8814 Draft - Parents' Election To Report Child'S Interest And Dividends - 2011 Page 3
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8814 (Rev. 11-2011)
Page
deductions that your child could take on his or her own return
General Instructions
such as:
•
Additional standard deduction of $1,450 if the child is blind,
•
Penalty on early withdrawal of child’s savings, and
Purpose of Form
•
Itemized deductions such as the child’s investment
expenses or charitable contributions.
Use this form if you elect to report your child’s income on your
return. If you do, your child will not have to file a return. You
If your child received qualified dividends or capital gain
can make this election if your child meets all of the following
distributions, you may pay up to $95 more tax if you make this
conditions.
election instead of filing a separate tax return for the child. This
•
The child was under age 19 (or under age 24 if a full-time
is because the tax rate on the child’s income between $950
student) at the end of 2011. “Student” is defined below.
and $1,900 is 10% if you make this election. However, if you
•
The child’s only income was from interest and dividends,
file a separate return for the child, the tax rate may be as low
including capital gain distributions and Alaska Permanent Fund
as 0% (zero percent) because of the preferential tax rates for
dividends.
qualified dividends and capital gain distributions.
•
The child’s gross income for 2011 was less than $9,500.
If any of the above apply to your child, first figure the tax on
•
The child is required to file a 2011 return.
your child’s income as if he or she is filing a return. Next, figure
•
The child does not file a joint return for 2011.
the tax as if you are electing to report your child’s income on
•
There were no estimated tax payments for the child for 2011
your return. Then, compare the methods to determine which
(including any overpayment of tax from his or her 2010 return
results in the lower tax.
applied to 2011 estimated tax).
•
Alternative minimum tax. If your child received tax-exempt
There was no federal income tax withheld from the child’s
interest (or exempt-interest dividends paid by a regulated
income.
investment company) from certain private activity bonds, you
You must also qualify. See Parents who qualify to make the
must take this into account in determining if you owe the
election below.
alternative minimum tax. This type of interest should be shown
Student. A student is a child who for some part of each of 5
in box 9 of Form 1099-INT. See Form 6251, Alternative
calendar months during the year was enrolled as a full-time
Minimum Tax — Individuals, and its instructions for details.
student at a school, or took a full-time, on-farm training course
Investment interest expense. Your child’s income (other
given by a school or a state, county, or local government
than qualified dividends, Alaska Permanent Fund dividends,
agency. A school includes a technical, trade, or mechanical
and capital gain distributions) that you report on your return is
school. It does not include an on-the-job training course,
considered to be your investment income for purposes of
correspondence school, or school offering courses only
figuring your investment interest expense deduction. If your
through the Internet.
child received qualified dividends, Alaska Permanent Fund
Certain January 1 birthdays. A child born on January 1,
dividends, or capital gain distributions, see Pub. 550,
1993, is considered to be age 19 at the end of 2011. You
Investment Income and Expenses, to figure the amount you
cannot make this election for such a child unless the child was
can treat as your investment income.
a full-time student.
Foreign accounts and trusts. If your child (a) had a foreign
A child born on January 1, 1988, is considered to be age 24
financial account or (b) received a distribution from, or was the
at the end of 2011. You cannot make this election for such a
grantor of, or transferor to, a foreign trust, you must complete
child.
Schedule B (Form 1040), Part III, and file it with your return.
How to make the election. To make the election, complete
Enter “Form 8814” on the dotted line next to line 7a or line 8,
and attach Form(s) 8814 to your tax return and file your return
whichever applies. Complete line 7b if applicable.
by the due date (including extensions). A separate Form 8814
Change of address. If your child filed a return for a previous
must be filed for each child whose income you choose to
year and the address shown on the last return filed is not your
report.
child’s current address, be sure to notify the IRS, in writing, of
Parents who qualify to make the election. You qualify to
the new address. To do this, use Form 8822, Change of
make this election if you file Form 1040 or Form 1040NR and
Address.
any of the following apply.
Additional information. See Pub. 929, Tax Rules for
•
You are filing a joint return for 2011 with the child’s other
Children and Dependents, for more details.
parent.
•
You and the child’s other parent were married to each other
but file separate returns for 2011 and you had the higher
Line Instructions
taxable income.
•
You were unmarried, treated as unmarried for federal
Name and social security number. If you are filing a joint
income tax purposes, or separated from the child’s other
return, include your spouse’s name but enter the social
parent by a divorce or separate maintenance decree. The child
security number of the person whose name is shown first on
must have lived with you for most of the year (you were the
the return.
custodial parent). If you were the custodial parent and you
remarried, you can make the election on a joint return with your
Line 1a. Enter all taxable interest income your child received
new spouse. But if you and your new spouse do not file a joint
in 2011. Do not include tax-exempt interest in the total for line
return, you qualify to make the election only if you had higher
1a, but be sure to include it on line 1b.
taxable income than your new spouse.
If your child received, as a nominee, interest that actually
Note. If you and the child’s other parent were not married but
belongs to another person, enter the amount and “ND”
lived together during the year with the child, you qualify to
(nominee distribution) on the dotted line next to line 1a. Do not
make the election only if you are the parent with the higher
include amounts received as a nominee in the total for line 1a.
taxable income.
If your child had accrued interest that was paid to the seller
Tax benefits you cannot take. If you elect to report your
of a bond, amortizable bond premium (ABP) allowed as a
child’s income on your return, you cannot take certain
reduction to interest income, or if any original issue discount
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