Yusef, age 15, is a dependent of his parents. In 2018 he earned $5,000 from a part-time job and $8,000 of interest income on bonds given him by his grandparents, resulting in taxable income of $7,650. Under kiddie tax rules, calculation of tax requires dividing taxable income between net unearned income and earned taxable income. Yusef's taxable income will be divided as follows:
A. net unearned income -$5,900 and earned taxable income -$1,750.
B. net unearned income -$1,750 and earned taxable income -$5,900.
C. net unearned income -$0 and earned taxable income -$7,650.
D. net unearned income -$7,650 and earned taxable income -$0.
Answer: A
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