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>>OK, I understand how to minimize taxes when my kids stocks generate income but, I'm sad to say, my kids have been losing this year. If I have to pay on their income, can I conversely deduct their losses? How about the one who turned 14 this year. <<

First, you don't have to pay taxes on their income. They (if under age 14) have to pay taxes on their income (after certain adjustments) at your rate. Of course, you can choose to include their income on your return, but that is usually not the best course of action.

Unfortunately, you I don't believe you can deduct their losses. As I recall, they carry their losses forward until such time as they can use them.

And as for your 14 year old, s/he gets to file on his/her own, at (presumably) a lower rate than you do. Of course, if s/he is still being claimed as your dependent, then they lose their personal exemption and the standard deduction is limited to $700.

Ira
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