Reply #7: Be angry, but... [View All]

[bmcatt]

Please remember that there *is* language in the tax code that allows for limited *gifts* to others ($11,000 per donating person). As such, if the money was gifted to the teens, it is, by defnition, theirs.

This sounds about as bad as, say, New York trying to tax non-resident income based on a tax-rate calculated for the entire family's income.

And, also - not everyone who, as a teen, has investment income is a "trust fund" kid. Some of them work and choose to invest their extra income instead of spending it as soon as it hits their pocket, and some of it may be gifted by working parents who are trying to teach their kids about how to manage their own money for when they're grown up.