Watch Out For Kiddie Tax!
Remember, if your child has investment income, it may be taxed at a higher rate. If the child's investment income is more than $1,900 they may have to pay tax on that income at the parents rate. Your child may qualify for this tax if they were born after January 1st, 1992 or if the child was born before January 1st 1992 and was dependents on another person's return.