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<<<<I was told that once he has ownership, he can gift the ownership. The larger one he was planning on taking out 20,000 to cover the first year tuition, and transferring ownership of the balance to us; and then each year we would take out from there for his tuition. We were told by our accountant that's the only way to avoid the sale of the stocks. I'm in the process of filling out the FAFSA form (the one the government requires to apply for financial aid) I'd like to know if this is a good plan financially, as far as capital gains when the money is taken out before he transfers it, and if we take some out.>>>>

I dislike being the bearer of potentially bad news, but IMO this series of transactions borders on fraud. "Junior" is not really making a gift. Why should "junior" not pay for his own education?

In addition, any aid officer worth his or her salt will ask "junior" what happened to these other dollars that were in your account; if the truth be told, I suspect that the aid officer will still count them as "junior's" funds; if the truth not be told then y'all are only digging your own hole deeper, IMO.

To be forewarned is to be prepared.

Just my $0.02. Regards, JAFO
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