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Author: TMFTaxes Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121333  
Subject: Re: HELP!! Date: 9/17/2000 6:07 PM
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<<I am 16 years old. I know a good deal about stocks and I have $2,000 that I don't need anytime soon. I want to make the money grow. I was thinking of using the dow investing strategy. However, since I'm sixteen I will have to have one of my parents be custodian of the account or put the account in one of my parents name.>>

No...the account can be in YOUR name and reported under your social security number. Your parents will simply act as your legal agents (if you will) to execute the documents (since you aren't of legal age to do so).

<<If I have one of my parents as custodian of the account will it lower count towards financial aid for college as one of my assets or as one of my parents.>>

It's my understanding that, either way, the account would tend to decrease your ability to receive financial aid. But this is not my speciality. You might want to check out the "saving for college" folder, where more people with this specific knowledge hang out.

<<Also if I do this, when I take the money out will I be taxed according to my tax bracket (5%) or my dad's which is 30%.>>

Since the account will likely be in your name and your SS number, any taxes (when the shares are sold...not necessarily when you "take out" the money) will be taxed at your rate. If the account is in dad's name, then taxes will be paid at his rate.

<<My parents file taxes as joints and not independents.
My dad works, he's in the 30% bracket but my mom doesn't. So if I put the invested money in her name and mine as a joint how much percentage of tax will be taken from the profit.>>

Since they file a joint return, it will make no difference if it's in your mom's name or your dad's name. It'll all be reported in the same pot.

If you want to minimize your tax bite, putting the account in your name would likely be your best course of action.

TMF Taxes
Roy

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