Introduction
Claiming someone as a dependent doesn't mean their income lands on your return. That's the trap. A teenager with a summer job or a small brokerage account can have their own filing duty, even while a parent claims them.
IRS Publication 929 was the guide that covered this. The IRS has stopped revising it after tax year 2021, and its content has moved into Publication 501 and the Form 8615 and 8814 instructions.
This article explains the rules Publication 929 covered and where to verify current figures. Amounts below are US federal figures in US dollars, since the rules are US-specific.
Key Takeaways
- Claimability and filing duty are separate tests; a dependent may need a return either way.
- Filing depends on age, filing status, earned and unearned income, blindness and special taxes.
- Children with unearned income over $2,700 may face the kiddie tax (Form 8615) or a parental Form 8814 election.
- Use current IRS publications and instructions, not older articles.
What Is IRS Publication 929 and What Does It Cover?
Publication 929, "Tax Rules for Children and Dependents," helped taxpayers decide whether a child or dependent must file and how their income is treated. The latest IRS-hosted edition is for tax year 2021. It is a historical guide, not a source for current thresholds.
Its material now lives in these resources:
- Publication 501 (2025): dependency tests, filing requirements and the standard deduction
- Form 1040 instructions (2025): filing charts and worksheets
- Form 8615 instructions: the child's tax on unearned income
- Form 8814 instructions: the parent's optional interest and dividend election
The 2026 versions of Forms 8615, 8814 and 1040 are drafts and are not for filing. Check the IRS site for final releases before relying on them.
How to Determine Who Is a Dependent and Who Must File
Ask two questions independently: can someone claim this person, and must this person file?
The Two Dependency Categories
Per Publication 501 (2025), a dependent is either a qualifying child or a qualifying relative.
| Test | Qualifying child | Qualifying relative |
|---|---|---|
| Relationship | Child, sibling or their descendants | Listed relatives, or an all-year household member |
| Residence | More than half the year with you | Listed relatives need not live with you |
| Age | Under 19, or a student under 24 | None |
| Support | Child provides no more than half their own support | You generally provide more than half |
| Gross income | No separate test | Below $5,200 (2025); $5,300 (2026) |
Temporary absences for school, illness, business, vacation or military service still count as living together. A full-time student must attend during part of five calendar months.
When parents are divorced or separated, the parent with more nights is the custodial parent. A Form 8332 release can shift the dependency claim to the other parent.
Filing Triggers for 2025
Under Publication 501 (2025), a single dependent under 65 and not blind generally must file if:
- Unearned income exceeds $1,350
- Earned income exceeds $15,750
- Gross income exceeds the larger of $1,350 or earned income (up to $15,300) plus $450
Higher thresholds apply to those who are 65 or older or blind, and to married dependents. A married dependent whose spouse files separately and itemizes must file with gross income of $5 or more. The IRS has not yet released a final 2026 dependent filing table.
Triggers That Apply Despite Low Income
- Net self-employment earnings of at least $400
- Alternative minimum tax
- Social Security or Medicare tax on unreported tips or wages
- Household employment taxes
- Health savings account distributions
- Additional taxes on tax-favored accounts
Filing can also pay off. A dependent may recover withheld tax or claim a refundable credit such as the earned income credit.
What Filing Rules Apply to Children and Other Dependents?
Use this short sequence before you decide whether a dependent must file:
- Confirm the dependent's status and filing status.
- Classify each income source as earned or unearned.
- Compare totals with current IRS thresholds.
- Check the special triggers above.
- Decide whether a separate return is needed.
Standard Deduction and Income Types
For 2026, the dependent's standard deduction is the greater of $1,350 or earned income plus $450, capped at $16,100 for single filers (Rev. Proc. 2025-32). Age or blindness adds $1,650 per condition, or $2,050 if unmarried.
- Wages, tips and taxable scholarships count as earned income for the deduction.
- Interest, dividends and capital gains are unearned; tax-exempt interest is not gross income.
- Gig work counts as earned income; Schedule SE still computes self-employment tax separately.
A dependent files their own Form 1040 even when claimed by someone else. The return has a checkbox for "Someone can claim you as a dependent." The limits depend on claimability, not on whether anyone actually claims them.
A Quick Comparison
The IRS's own 2025 example: a 16-year-old with $150 in wages and $780 in interest has a $1,350 deduction. Using the 2025 table, that child's gross income of $930 is below the $1,350 threshold, so no return is required.
Raise the interest well above $1,350, or add $400 of net freelance earnings, and filing is required. A child with only modest wages may owe nothing; a child with investments or freelance work often must file.
Warning: Don't assume no return is needed because there's no regular job. Small investment accounts and side income create filing duties.
How Are a Child's Unearned Income and the Kiddie Tax Reported?
Unearned income is anything other than pay for work, including:
- Taxable interest and dividends
- Capital gains, rents and royalties
- Trust income and non-W-2 taxable scholarships
When Form 8615 Applies
The kiddie tax taxes part of a child's unearned income at the parent's rate if that rate is higher. Under the 2026 draft instructions, Form 8615 applies when:
- Unearned income is over $2,700
- The child must file a return
- At least one parent is alive at year-end
- The child isn't filing a joint return
- Age is under 18; or 18 (or full-time student 19–23) with earned income not above half of support
The same $2,700 threshold appears in the final 2025 instructions. The child files Form 8615 with their Form 1040.
The Form 8814 Election
A parent may instead report the child's income on their own return. Per the draft 2026 instructions, that election requires:
- The child is under 19, or under 24 if a full-time student
- Income is only interest and dividends (including capital gain distributions)
- Gross income is over $1,350 but under $13,500
- No joint return, estimated payments or federal withholding on the child's income
On the parent's return, the first $1,350 is untaxed and the next $1,350 is taxed at 10%. Anything above $2,700 is included in the parent's income. Higher AGI can reduce deductions and credits.
Compare Before Choosing
Qualified dividends and capital gain distributions may be taxed at 0% on a child's own return. Electing Form 8814 can add up to $135 in tax.
The Form 8814 instructions tell taxpayers to calculate both ways and compare.
Practical Filing Checklist: Records, Forms, and When to Seek Help
Documents to Gather
- Dependent's SSN, or ITIN if ineligible for an SSN (Form W-7)
- W-2s, 1099s and brokerage and bank statements
- Withholding details
- Support and residence records, where relevant
- Prior-year returns
Forms by Situation
| Situation | Likely form |
|---|---|
| Dependent's own return | Form 1040 |
| Child's unearned income over $2,700 | Form 8615 |
| Parent's interest and dividend election | Form 8814 |
| Child tax credits or ACTC | Schedule 8812 |
| Freelance or gig income | Schedule SE |
| Correcting a past return | Form 1040-X |
For Form 1040-X, file within 3 years of the original filing or 2 years of payment, whichever is later.
When to Get Professional Help
Consider a review if any of these apply:
- Investment income or self-employment
- Divorced or separated parents, or competing support claims
- Foreign income or nonresident status
- Doubt about prior filings
US citizens abroad generally follow the same filing rules, and worldwide income is taxable. Nonresident dependents use Form 1040-NR, which has different deduction rules.
VJM Global prepares US individual returns (Form 1040 and 1040-NR) and handles cross-border matters such as FATCA, Form 8938 and FBAR filings. It can support complex US or cross-border cases; the right approach still depends on your facts.
Frequently Asked Questions
What is IRS Publication 929?
It was an IRS guide to filing requirements and reporting rules for children and other dependents. The last edition covers tax year 2021; use Publication 501 and the Form 8615 and 8814 instructions now.
Does a dependent have to file a tax return?
It depends on income type and amount, age, filing status and special taxes such as self-employment tax. Check current IRS thresholds each year.
Does a parent have to report a child's income?
No, the child generally files separately. A parent may elect to report eligible interest and dividends on Form 8814, but that election has limits.
What is the kiddie tax and when does Form 8615 apply?
It taxes certain children's unearned income over $2,700 at the parent's rate when higher. Form 8615 computes it, subject to age, support and filing conditions.
Can a parent use Form 8814 to report a child's interest and dividends?
Only if the IRS conditions are met, including income limits and no withholding or estimated payments. Compare it with a separate child return first.
What is the difference between claiming a dependent and filing for a dependent?
A taxpayer can claim an eligible person as a dependent while that person still files a separate return for their own income.
