Unearned Income of Minor Children and Certain Students (LO 6.10)

Brian and Kim have a 12-year-old child, Stan. For 2015, Brian and Kim have taxable income of $52,000, and Stan has nonqualifying dividend income of $4,500 and investment expenses of $250. No election is made to include Stan's income on Brian and Kim's return.

a. For purposes of the tax on a childs unearned income, calculate Stan's net unearned income.

b. Calculate the amount of Stans tax at his parents rate.

c. Calculate Stan's total tax for 2015.

Note:Assume a 10% rate on regular taxable income.