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Lane
Lane, CFP, MBA, CRPS
Category: Tax
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Experience:  Providing Financial & Tax advice since 1986
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when giving children stocks, when do they have to pay property

Resolved Question:

when giving children stocks, when do they have to pay property gains taxes
Submitted: 10 months ago.
Category: Tax
Expert:  Lane replied 10 months ago.

NPVAdvisor :

Hi,

NPVAdvisor :

They will not pay property gains taxes until (and unless) the sell them

NPVAdvisor :

The tax will be a capital gains tax, and if held for more than one year, will be taxed at the lower capital gains rates (as opposed to being taxed as ordinary income)

NPVAdvisor :

The new capital gains tax rates for 2013 and future years are as follows:



  • 0% applies to long-term gains and dividend income if a person is in the 10% and 15% tax brackets,

  • 15% applies to long-term gains and dividend income if a person is in the 25%, 28%, 33%, or 35% tax brackets, and

  • 20% applies to long-term gains and dividend income if a person is in the 39.6% tax bracket.

NPVAdvisor :

There is also a new 3.8% medicare tax on top of that (IF their incomes are above ...



  • $250,000 for married filing joint filers and qualifying widows or widowers;

  • $200,000 for single and head of household filers; and

  • $125,000 for married filing separately filers.)

NPVAdvisor :

Here's an excellent article on that: http://taxes.about.com/od/payroll/a/Medicare-Tax.htm

NPVAdvisor :

One lase thing; The capital gains tax is taxed on the gain (net sales price minus the tax basis in the assets) ... If you gift them the stocks, your basis will carry over to them ... if they are left to them at death, then the basis is stepped up to the fair market value as of date of death, so that if they are sold right away, there may be NO capital gains at all

Lane, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 3644
Experience: Providing Financial & Tax advice since 1986
Lane and 2 other Tax Specialists are ready to help you
Expert:  Lane replied 10 months ago.


hi Thelma,

I noticed that you rated my answer as just OK.

If there's anything else I can add or do to make you a more satisfied customer, please let me know.

And do so here, so they won't charge you for another question.

Thanks,
Lane

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