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Author: irasmilo 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 121323  
Subject: Re: how to split a joint account Date: 3/13/2014 9:48 AM
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This thread is so full of misinformation that we need to start over.

Original account was established by gift from mother to two children. If mother gave stocks as part of the gift, the children need to know what the mother's cost basis was in the stocks.

Now hondochica wants to give all of account to sister. Sister already owns 1/2 of account and can transfer that amount to a new account her name alone immediately with no tax consequences.

Hondochica can transfer remaining value of account to sister at $14K/year to avoid having to file a gift tax return or can transfer everything at once and file a gift tax return reporting the excess value over $14K. The excess will count against hondochica's lifetime gift tax exclusion which is currently $5.34million.

Hondochica needs to know the cost basis of the stocks transferred to sister because sister will use that cost basis and holding period to determine any gain if she sells the stock. She will use the market value on the date of the gift to determine any loss if she sells the stock. Note that if any of these stocks were part of the original gift from mother, mother's cost basis is transfered to sister.

Ira
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