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I own 12,000 shares of depreciated stock which will probably appreciate again in six to nine months time. My basis is just under $4.00. The current market bid/ask is in a tight range about $1.50. I would like to gift 5500 shares to my 24 year-old Canadian nephew and 6500 shares to my 40 year-old British cousin (who are both minority shareholders in and officers of a small investment company located in one of the Euro countries - I am not). What options and possible consequences do I have in making these gifts without exceeding the $10,000 gift limit per person(/entity?) per year? If necessary, they could temporarily arrange for the availability of cash equivalent to the current market value. What are the US tax consequences for them?

P.S. I looked under TMF Taxes FAQ but didn't find what I needed.
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