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emc011075
emc011075, Tax adviser
Category: Tax
Satisfied Customers: 2317
Experience:  IRS licensed Enrolled Agent and tax instructor
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If someone gifts an adult child stock in a company, is the

Customer Question

If someone gifts an adult child stock in a company, is the child's basis in the stock the parents original basis or the fair market value at the time of the gift? Is the taxable amount of the gift the parent's original basis or the fair market value at
the time of the gift?
Submitted: 1 year ago.
Category: Tax
Expert:  emc011075 replied 1 year ago.

Hi. My name is ***** ***** I will be happy to help you.

For stock received as a gift, child's basis will be the parent's original basis. Only inherited property get the set-up basis treatment (fair market value of the property on the day the original owner died).

Let me know if you have any questions.

Expert:  emc011075 replied 1 year ago.

If the value of the stock is less than 14K, no reporting is required, if the value is more, parents will be required to file gift tax return, form 709.

Expert:  emc011075 replied 1 year ago.

Gift tax, if any is always claimed/paid by the donor, never by the receiver of the gift. In addition to 14K annual exclusion, there's also lifetime gift exclusion of 5.43M, which means the donor can gift 5.43M during his/her lifetime before he/she has to pay gift tax.

Expert:  emc011075 replied 1 year ago.

I see you read my respond. Do you have any questions? Is there anything else I can help you with today?

And if this answered your question, please take a moment to rate my response so that I may receive credit for assisting you today. However, if you need clarification, or want to discuss this issue further, let me know. Thank you.

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