The Motley Fool Discussion Boards
Financial Planning / Tax Strategies
|Subject: Basic Questions||Date: 2/8/1999 7:49 PM|
|Author: Badger18||Number: 9774 of 123001|
I have some basic tax questions. Thanks much in advance for the help.
The first two Q's deal with investing outside of an IRA.
Am I correct in understanding that shares of stock are transferable to your heirs at a stepped-up cost basis, or some such term? Meaning that if I buy XYZ Corp now for $20/shr, and when I die it's worth $200/shr, my heirs receive it at a cost basis of $200/shr and only pay capital gains taxes, when they sell the stock, on any gain above the $200/shr price.
Is this true for mutual funds? If not, are mutual funds transferred at original cost basis?
The next Q deals with IRA investing.
What happens to a) stocks and b) mutual funds held in an IRA when you die? I.e. can they be transferred at a stepped-up cost basis?