Kid's unearned income in 2025: Do the filing threshold rules change annually?

Wait, so the $2,300 threshold includes ALL unearned income combined? I thought maybe it was separate for dividends vs capital gains. Also, does it matter if the money just stays in the investment account and gets reinvested vs if they actually take the money out?

Yes, the $2,300 threshold applies to the combined total of all unearned income - dividends, interest, capital gains, everything together. There's no separate threshold for different types of unearned income. Whether the money is reinvested or withdrawn doesn't matter for tax purposes. The IRS considers the income "realized" when the dividends or distributions are paid to the account, regardless of whether you withdraw the money or reinvest it immediately.

How accurate is this tool? I've tried other tax document scanning things before and they missed a lot of details. Does it actually explain WHY you don't need to file or just tell you that you don't?

Can it handle more complicated situations? My kids have both a UTMA account and a trust that generates income. Last year my accountant charged me $350 extra just to handle the kiddie tax forms.

It's been really accurate with everything I've thrown at it so far. It doesn't just say "no filing needed" - it actually walks through the exact calculation, showing how it adds up the different income types and compares them to the current year threshold. It even cited the specific IRS publication. For more complex situations, it definitely handles multiple account types. My neighbor used it with his kid's UTMA account and a small inheritance that generated interest. The tool separated everything correctly and showed which parts were reportable on which forms. Way cheaper than paying an accountant for something that's pretty straightforward once it's explained properly.

How does this even work? The IRS phone system is notoriously impossible to navigate. Does this just spam call for you or something? I'm confused how any service could magically get through when millions of people can't.

Yeah right. There's no way this actually works. I've been trying to talk to someone at the IRS about my daughter's investment income for THREE WEEKS. I've called at opening time, tried different numbers, everything. No way some random service can get through when the IRS itself says wait times are 120+ minutes.

It doesn't spam call - it uses a proprietary system that navigates the IRS phone tree and holds your place in line. When they're about to connect you, you get a call back and are joined with the IRS agent. I was skeptical too until I tried it. The reason it works is because they've mapped out all the IRS phone trees and know exactly which options to select for different issues. Plus they've figured out the optimal times to call for different departments. It's basically like having an expert who knows all the shortcuts handle the frustrating part for you.

Do you need to file anything with the IRS to document the increased cost basis from reinvested dividends? Or just keep records on your own? And does Vanguard track this automatically or do we need to calculate it ourselves?

You don't need to file anything with the IRS specifically for the cost basis adjustments. Just keep good records for your own documentation. Most major brokerages like Vanguard do track cost basis for shares purchased after 2011 (when the law changed requiring them to report it), but it's always good practice to keep your own records too. For shares purchased before 2011, you're completely responsible for tracking cost basis adjustments from reinvested dividends yourself.

This is so true! My daughter made about $8,000 at her part-time job and had about $1,500 in dividends from her grandparent's gift account. We thought we were fine until our accountant caught it. The rules get complicated fast when you mix earned and unearned income.

Thanks for the clear breakdown! I'm new to dealing with kids' investment accounts and this is really helpful. One quick question - when you mention Publication 929, is that something that gets updated every year around tax season? I want to make sure I'm checking the right source for 2026 when that time comes around. Also, do these threshold adjustments usually go up by a significant amount or is it typically just small changes?

@Ethan Wilson Publication 929 typically gets updated annually, usually by late fall or early winter for the upcoming tax year. The IRS releases these publications well before filing season so you have time to plan. As for the threshold adjustments, they re'usually modest - typically increasing by $50-$100 per year based on inflation. For example, the unearned income threshold was $2,200 in 2023, $2,300 in 2024, and remains $2,300 for 2025. Some years there s'no change at all if inflation is minimal. I d'recommend bookmarking the IRS Publication 929 page and checking it each December for the following year s'thresholds. That way you can plan ahead for any investment account decisions or know whether you need to start preparing for potential filings.

Yes, Publication 929 gets updated annually, usually by late December or early January for the upcoming tax year. The IRS typically announces the new thresholds alongside other inflation adjustments around that time. The threshold changes are usually pretty modest - typically $50-150 increases year over year based on inflation. For example, the unearned income threshold was $2,200 for 2024 and increased to $2,300 for 2025. So while it's good to check each year, you're usually looking at relatively small adjustments rather than dramatic changes. I'd recommend bookmarking the IRS's annual inflation adjustments announcement (they usually publish it as a news release) since it covers not just the kiddie tax thresholds but all the other inflation-adjusted amounts that might affect your family's taxes.

Yes, Publication 929 gets updated annually, usually released in late fall/early winter for the following tax year. For 2026 filing (2025 tax year), you'd want to check the updated version that comes out around November-December 2025. The threshold adjustments are typically modest - usually increasing by $50-100 per year based on inflation. For example, the unearned income threshold was $2,200 in 2023, $2,300 in 2024, and remains $2,300 for 2025 (no adjustment this year). So while they do change, it's generally incremental rather than dramatic jumps. I'd recommend bookmarking the IRS page for Publication 929 and just checking it each fall when you're doing tax planning. The IRS also usually announces the inflation adjustments in a press release around October/November each year.

@Ethan Wilson Yes, Publication 929 gets updated annually, usually released in late December or early January for the upcoming tax year. The IRS also updates their website with the new thresholds around the same time. The threshold adjustments are typically modest - usually increases of $50-150 per year based on inflation. For example, the unearned income threshold was $2,200 in 2023, $2,300 in 2024, and remains $2,300 for 2025 no (change this year .)So while it s'good to check annually, you re'usually looking at relatively small incremental changes rather than dramatic jumps. I d'recommend bookmarking the IRS page for Publication 929 and just checking it each January when you start thinking about taxes. That way you ll'always have the most current thresholds for your planning.

Yes, Publication 929 gets updated annually, usually by late December or early January for the upcoming tax year. The IRS also updates their online version on their website, so you can always find the current year's thresholds there. The threshold adjustments are typically modest - usually increasing by $50-150 per year based on inflation. For example, the unearned income threshold was $2,200 in 2023, $2,300 in 2024, and remains $2,300 for 2025 (no change this year). So while it's good to check each year, you're usually not looking at dramatic shifts that would completely change your filing situation. I'd recommend bookmarking the IRS page for Publication 929 and just checking it each December when you're starting to think about the upcoming tax season. That way you'll always have the most current numbers for planning purposes.

Yes, Publication 929 gets updated annually, usually by late fall/early winter before tax season. The IRS typically releases the updated version with the new year's thresholds around November or December. As for the adjustments, they're usually pretty modest - typically increases of $50-$100 per year based on inflation. For example, the unearned income threshold went from $2,200 in 2024 to $2,300 in 2025. Nothing dramatic, but enough that it's worth checking each year rather than assuming it stays the same. You can also find the current year thresholds in the instructions for Form 8615 when they're released, which is sometimes easier to locate than digging through the full publication.

@Ethan Wilson Yes, Publication 929 gets updated annually, usually released in late fall/early winter for the upcoming tax year. The IRS typically announces the new thresholds around November or December. The threshold adjustments are usually pretty modest - typically $50-100 increases year over year based on inflation. For example, the unearned income threshold went from $2,200 in 2023 to $2,300 in 2024, and stayed at $2,300 for 2025. Some years there s'no change at all if inflation is minimal. I d'recommend bookmarking the IRS website and checking for the updated Publication 929 each December. That way you ll'have the current year s'thresholds well before tax season starts. Much easier than trying to hunt down the info in April when everyone s'scrambling!

@Ethan Wilson Yes, Publication 929 gets updated annually, usually released in late December or early January for the upcoming tax year. The IRS also publishes a Revenue Procedure each year like (Rev. Proc. 2024-40 for 2025 tax year that) lists all the inflation-adjusted amounts. The threshold adjustments are typically modest - usually $50-100 increases per year based on inflation. For example, the unearned income threshold was $2,200 for 2024 and $2,300 for 2025. However, during periods of higher inflation like we ve'seen recently, the adjustments can be slightly larger. I d'recommend bookmarking the IRS s'annual inflation adjustment announcements or setting a calendar reminder each January to check for the updated thresholds. It s'also worth noting that these same inflation adjustments affect other tax provisions like standard deductions and tax bracket thresholds, so it s'useful info beyond just the kiddie tax rules.

Yes, Publication 929 gets updated annually, usually in late fall or early winter before tax season begins. The IRS typically releases the updated version around November or December with the new thresholds for the upcoming tax year. The threshold adjustments are generally modest - usually anywhere from $50 to $200 increases per year based on inflation. For example, the unearned income threshold went from $2,200 in 2023 to $2,300 in 2024, and stayed at $2,300 for 2025. Some years it doesn't change at all if inflation is low. I'd recommend bookmarking the IRS.gov page for Publication 929 and checking it each December to get ahead of the game for the following year's planning. That way you can adjust your kids' investment strategy if needed to stay under the threshold.

Yes, Publication 929 gets updated annually, usually released in late fall/early winter before the tax filing season begins. You can find it on the IRS website at irs.gov, and they archive previous years' versions too if you need to reference older thresholds. The threshold adjustments are typically modest - usually increases of $50-$150 per year based on inflation. For example, the unearned income threshold was $2,200 in 2023, $2,300 in 2024, and remains $2,300 for 2025. So while it does change, it's not dramatic year-to-year increases. Pro tip: if you bookmark the general Publication 929 page rather than a specific year's PDF, it will automatically show you the current version each time you visit. Makes it easy to check the updated thresholds each tax season without hunting for the new publication!

Yes, Publication 929 gets updated annually, usually in late fall/early winter before tax season starts. You can find it on the IRS website - just search for "Publication 929" and make sure you're looking at the current tax year version. The threshold adjustments are typically modest - usually increasing by $50-$100 per year based on inflation. For example, the unearned income threshold was $2,200 in 2023, $2,300 in 2024, and remains $2,300 for 2025. Sometimes it stays flat if inflation doesn't warrant an increase. I'd recommend bookmarking the IRS Publications page and checking it each December/January when planning for the upcoming tax year. The changes are usually announced well before filing season begins.

Yes, Publication 929 gets updated annually, usually released in late December or early January for the upcoming tax year. The IRS typically announces the new thresholds as part of their annual inflation adjustments. The threshold changes are usually pretty modest - typically $50-100 increases from year to year. For example, the unearned income threshold was $2,200 in 2023, $2,300 in 2024, and remains $2,300 for 2025. Sometimes it stays the same for a couple years if inflation is low. I'd recommend bookmarking the IRS's annual revenue procedure announcements (usually Rev. Proc. 2024-XX format) since they publish all the updated tax brackets and thresholds in one place each fall. Makes it easy to check if your kids will still be under the threshold as their accounts grow!

Yes, Publication 929 gets updated annually, usually released in late fall/early winter for the following tax year. The IRS typically publishes the updated version around November or December, so you'd want to check for the 2026 version around that timeframe. As for the threshold adjustments, they're usually pretty modest - typically increasing by $50-150 per year based on inflation. For example, the threshold was $2,200 in 2023, $2,300 in 2024, and remains $2,300 for 2025 (sometimes it stays the same if inflation adjustments round down). So while it's good to check each year, you're usually looking at small incremental changes rather than dramatic jumps. The IRS also announces these changes in their annual inflation adjustments press release, which is another reliable source if you want to stay on top of it!

Yes, Publication 929 gets updated annually, usually released in late December or early January for the upcoming tax year. The IRS typically announces the new thresholds along with other inflation adjustments around that time. As for the amounts, the changes are usually pretty modest - typically $50-150 increases year over year. For example, the threshold was $2,200 for 2024 and $2,300 for 2025, so just a $100 bump. It's based on inflation adjustments, so in years with higher inflation you might see slightly larger increases, but nothing dramatic. I'd recommend checking the IRS website or subscribing to their tax updates if you want to stay on top of these changes. The threshold adjustments affect a lot of families with kids' investment accounts, so it's definitely worth tracking!

@Ethan Wilson Yes, Publication 929 gets updated annually, usually around December or January for the upcoming tax year. The IRS typically releases the updated thresholds along with other inflation adjustments. The changes are usually pretty modest - typically $50-$150 increases per year based on inflation. For example, the unearned income threshold went from $2,200 in 2024 to $2,300 in 2025. So while it s'good to check each year, you re'usually looking at small incremental changes rather than dramatic shifts. I d'recommend bookmarking the IRS website page for Publication 929 and just checking it each December when you re'starting to think about the next year s'taxes. That way you ll'always have the most current thresholds for planning purposes.