Ken and Lynn paid $5,000 to purchase Series EE bonds in the name of their 11-year-old son. The son has no icome , and they are in the 28% bracket. The taxable interest this year will be $400 if an election is made to accrue the interest on an annual basis.

a)Will the child owe any tax to file a tax return?

b) Does the son need to file a tax return?

c) What are the current and future tax consequences of annual gifts to their son?