Terri, age 16, is claimed as a dependent on her parents' 2011 return. During the year, Terri earned $5,000 in interest income and $3,000 from part-time jobs.
a) What is Terri's taxable income?
b) How much of Terri's income is taxed at her own tax rate? At her parents' rate?
c) Can the parental election for the kiddie tax be made? Why or why not?