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Author: jbet Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121594  
Subject: Gifting Stock Date: 3/1/2001 10:03 AM
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When a stock is gifted does the cost basis begin the day of the gifting or the date when the stock was first purchased?
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Author: pmarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 47476 of 121594
Subject: Re: Gifting Stock Date: 3/1/2001 12:52 PM
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When a stock is gifted does the cost basis begin the day of the gifting or the date when the stock was first purchased?

The recipient gets the donor's holding period and, usually, the donor's basis. There are some situations when the stock has declined in value that the value as of the date of transfer is the recipient's basis. See IRS Publication 551.

Phil Marti
VITA Volunteer

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Author: kelliejo Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 47670 of 121594
Subject: Re: Gifting Stock Date: 3/4/2001 11:35 PM
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I cut this from the IRS web site because I am in the same situation. Not sure exactly what it means based on your situation, but it might help:

http://www.irs.ustreas.gov/prod/tax_edu/faq/faq-kw89.html
I received stock as a gift from my grandparents. I am selling the stock this year. How can I figure the basis of the gifted stock?
To figure the basis of property you receive as a gift, you must know its adjusted basis to the donor just before it was given to you, its fair market value (FMV) at the time it was given to you, and any gift tax paid on it.

If the FMV of the property was less than the donor's adjusted basis, your basis for gain on its sale or other disposition is the same as the donor's adjusted basis plus or minus any required adjustment to basis during the period you held the property. Your basis for loss on its sale or other disposition is its FMV at the time you received the gift plus or minus any required adjustment to basis during the period you held the property.

If the FMV of the property was equal to or greater than the donor's adjusted basis, your basis for gain or loss on its sale or other disposition is the same as the donor's adjusted basis at the time you received the gift. Increase your basis by all or part of the gift tax paid, depending on the date of the gift.


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