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I'm asking this question on behalf of a friend of mine whom I am trying to help resolve a tax situation. She will be in the 10% tax bracket this year, and is classified as a dependent. She has a UTMA account with approximately $14,000 dollars of which $4,000 is appreciation on mutual funds. She wants to be able to take out as much of the money as possible, and I'm trying to figure out what is the best strategy to follow with regards to taxes.

I am trying to determine how much she is liable to be taxed on the appreciation if she wants to take out a certain amount of money. Researching online I found that she may be liable to the so called "kiddie tax" with regards to capital gains. I wanted to ask the experts about how much she should expect to pay in taxes if she takes out a certain amount of money?

Researching online I believe she does not have to pay taxes on the first $900 of capital gains, then on the next $900 she owes taxes at her capital gains rate (which should be 0% for the 10% tax bracket), and after that she owes taxes at her parents rates. Is that correct, or is it more nuanced?

Thank you!
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