cred65 Posted January 5, 2018 Report Share Posted January 5, 2018 Client owns stock and wants to gift shares to his 18 year old for college this year. He also wants to know if he can gift $15K to his wife and have her gift to son. Is this the best way to get max amount to son? TIA Quote Link to comment Share on other sites More sharing options...
Max W Posted January 5, 2018 Report Share Posted January 5, 2018 If client gifts stock (transfers to son's name), it has to be done through a transfer agent, otherwise it could result in a taxable transaction. https://finance.zacks.com/transfer-shares-stock-another-person-2598.html As for the mother, there is no gifting between spouses. The money can be transferred back and forth without any consequences. However, for the mother to gift to the son, the funds would have to come from her own separate bank account, not a joint account with the father. So if there is no separate account, it should be set up before transferring from spouse to spouse. 1 Quote Link to comment Share on other sites More sharing options...
jklcpa Posted January 5, 2018 Report Share Posted January 5, 2018 42 minutes ago, cred65 said: Client owns stock and wants to gift shares to his 18 year old for college this year. He also wants to know if he can gift $15K to his wife and have her gift to son. Is this the best way to get max amount to son? There's no need for the husband to gift the shares to his wife before it ultimately is gifted to the son. Even if the shares are solely in his name, he can gift shares directly to his son and elect to gift splitting the gift with his wife. It's as if husband gifted shares to the wife first without having to actually go through that step. If the total value of the gift is less than $30K, meaning with gift splitting that each gives an amount that is equal or less than the annual exclusion of $15K for 2018, then only one gift tax return is required with the split being reported all on the one return. If the combined total value of the split gifts exceeds the combined total of their annual exclusions, again the $30K, then each will file a gift tax return that reports the gift splitting, and it will also report how much of their share of the unified credit will be used to offset the excess of each of their gifts that exceeds the annual exclusion. Per the from 709 instructions, both returns should be mailed in the same envelope so that they are processed at the same time. 3 Quote Link to comment Share on other sites More sharing options...
cred65 Posted January 5, 2018 Author Report Share Posted January 5, 2018 Thanks Max & Judy. Quote Link to comment Share on other sites More sharing options...
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