My father wants to give a onetime gift of $1 million of stock to his children split 6 ways. What are the tax implications for the children if they sell the stock, either immediately or after 1 year?
by 
apschiff@hotmail.com
ANSWERS: 1
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The tax implications are that each child assumes dad's basis in the stock, so if he paid $.10 share, that's what you get and it doesn't matter if the stock is now worth $1000/share! And holding it for one year or 100 years doesn't matter as you also get dad's holding period. Better for Dad to have a trust, let the trust inherit the stock on Dad's death, get a step up in basis to the value of the date of death, then let the trust sell the stock and walla: NO GAIN! Then distribute the profit to the kids.
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