Should I claim my kids 1099DIV and 1099-B forms on my taxes? I claimed them as dependents, both are 18 and older and full time college students.

The way to file taxes for unearned income(Form 1099-DIV and Form 1099-INT) for children is determined by how much they've made. 

• If your child's only income is unearned and doesn't exceed $1,150, it doesn't need to be reported
• If your child's unearned income is between $1,150 and $12,950, they may need to file their return, but in certain situations, this income can be included on your return
• If your child's unearned income is $12,950 or more, they need to file their return

TurboTax will guide you through the steps of the process. 

1. Open or continue your return
2. Search for child income and select the Jump to link
3. Answer Yes to both Any Child's Income? and Child Required to File?
4. Select Continue on the Reporting Your Child's Income screen
5. We'll ask you a series of questions to determine if the income can be included on your return or if your child needs to file their own return.

If a child's income includes a 1099-B, sale of securities. This will need to go on a separate tax return for the child. Enter the 1099-B along with the 1099-DIV in her tax return.

In fact, you can only report her unearned income on your return if the only income she had for the year was interest, dividends and capital gains distributions (reported on a 1099-DIV).

Please see Figure 1 in IRS Publication 929, Tax Rules for Children and Dependents

Q. Should I claim my kids 1099DIV and 1099-B forms on my taxes?

A. No.  If your child has a 1099-B, his income is not eligible to be reported on your return*.  He must file his own return, if his income is high enough. 

You do not report his/her income on your return. If it has to be reported, at all, it goes on his own return. If your dependent child is under age 19 (or under 24 if a full time student), he or she must file a tax return for 2022 if he had any of the following:

1.          Total income (wages, salaries, taxable scholarship etc.) of more than $12,950 (2022).
2.          Unearned income (interest, dividends, capital gains**, unemployment, taxable portion of 529 distribution) of more than $1150 (2022)
3.          Unearned income over $400 (2022) and gross income of more than $1150 (2022)
4.          Household employee income (e.g. baby sitting, lawn mowing) over $2300 ($12,950 if under age 18)
5.          Other self employment income over $432, including money on a form 1099-NEC

Even if he had less, he is allowed to file if he needs to get back income tax withholding. He cannot get back social security or Medicare tax withholding.

In TurboTax, he indicates that somebody else can claim him as a dependent, at the personal information section.

*If his only income is from interest and dividends, Alaska PFD or capital gains distributions shown on a 1099-DIV, there is a provision for entering it on your return, using form 8814. 

**Even if his actual capital gain is less than $1150,  just having a 1099-B usually means he should file.  The gross proceeds amount on the 1099-B may be enough to trigger an IRS inquiry.