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Author: SnootFool Two stars, 250 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 120795  
Subject: UTMA taxes vs parental safe harbor? Date: 3/27/2000 11:02 PM
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Hi Roy/Phil-
I've read the FAQ & done a search, but I didn't find an answer to this question:
My kids have UTMA accounts which collectively generate just enough dividends to trigger the kiddie tax. Since neither one has found a job yet (some lame excuse about learning to read & write first), neither has W-2 income to manipulate withholding to avoid estimated taxes. What, if any, is the relationship between my safe harbor WRT estimated taxes & their tax liability? Can the little tricycle motors piggyback onto Dad's W-2 safe harbor or am I going to have to find a Dickensian sweatshop for them to work in? Does anybody have Kathie Lee's number?
My understanding is that the threshold for the penalty to kick in is taxes >$1K. Is that a separate grand for each kid, plus me & the missus (MFJ) or what?
FWIW, we file separate returns for each tyke & our collective AGI is well below $150K.

Thanks,
Chris

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