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Gift Stock Tax
Joshua Said:Is the $24,000 gift tax exculsion for spouses applicable for stock in only one spouses name?
We Answered:The gift tax exclusion will apply to both husband and wife. See 26 U.S.C. 2513(a)(1) for property transfers deemed to be made 1/2 by wife and 1/2 by husband.
Rene Said:What does "Only gift tax attribitual to appreciation" mean?
We Answered:Appreciation is the increase in value since the original purchase.
The calculation is a proration of the gift tax between the basis and the appreciation.
Of the $100,000 in stock given to the son, $40,000 of it is basis and $60,000 of it is appreciation.
So, of the $10,000 in gift tax paid, $4000 of it is attributable to the original basis ($40,000/$100,000 x $10,000) and $6000 of it is attributable to the appreciation ($60,000/$100,000 x $10,000).
Marsha Said:I received stock certificates as a gift. I sold the stock. Do I have to pay taxes on the money I received?
We Answered:The simple answer is possibly.
We first need to determine the price of the stock at the time you received them. Once you have determined that, we then compare that to the sales price to determine the gain or loss on the stock. If you have a gain then you will have to pay capital gains tax based on your holding period before sale. Capital gains are taxed differently when you hold the stock for under one year or less versus over one year.
If you have a loss you can use up to $3,000 against ordinary income (meaning you have not had any sales of stock in that year) or use the amount needed to offset any capital gains in each year.
If you are still confused you might want to consult a financial advisor or a tax preparer that deals with Schedule D issues.
Francis Said:Tax question- Just under 10,000 gift of stock for 6 yrs in a row.?
We Answered:If you sell for a profit, your basis is the same as the basis of the previous owner (how much your grandmother paid for the stock). In other words, the basis is transferred along with the property.
If you sell for a loss, the basis is either the previous owner's basis or the value of the stock at the time of the gift, whichever is lower.
You would add into the basis the dividend reinvestments
Jack Said:Tax liability re stock gifting?
We Answered:Yes- give it to them over time. The annual gift tax exclusion is 13,000- give them no more than that each year until you've gifted it all- this will avoid having to deal with either gift taxes or your estate being affected when you die.
Remember to give them all of the information on your basis in the stock, as related party transactions involving capital gains property can be complicated when the recipient sells- especially if they don't have all of the information from the donor.
Hope that helps. :0)
Lillian Said:Tax question: My girls recieved stock as a gift, some was reinvested, some cashed out, is all of it taxed?
We Answered:As a rule, it is only what was cashed out. You give very few details. If they inherited the stocks, they will inherit the stock at the price on the date of the donor's death (as a general rule). If that, and the subsequent sale, was quite recent, there will probably be a minimal tax liability. If, however, the stocks were gifted, your daughters will acquire the holding period and basis of the donor. If the donor held the shares for a long time, the basis might be very small, giving a high gain.
Please bear in mind that the so-called "Kiddie Tax" now applies to under 18's (used to be under 14's) so their income may have to be taxed on your return.
Cory Said:If I receive a stock certificate as a gift worth more than the yearly gift amount?
We Answered:gifts are not taxable to the recipient
the person who gifted you the stock pays the gift tax if it exceeds the limit