AboutJohn Stancil, CPA Expertise I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I teach tax and accounting at a small church-related college. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a part time tax practice for over 30 years. I am a member of the AICPA, National Society of Tax Professionals, and the Institute of Management Accountants.
Experience I hold a doctorate in Accounting, and four professional certifications: CPA, CMA, CFM, and CIA. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I write a monthly tax column for the local newspaper.
Expert: John Stancil, CPA Date: 7/5/2008 Subject: How much my kid will pay?
Question Hi,
My son will go to a fulltime college this fall as a freshman. If I give my ESPP to him as a gift, does the amount still restricted under $12000 so that I don't have to pay for gift tax?
Second, how much my son will need to pay when he receive such ESPP gift?
Thanks,
Emily
Answer Emily,
Thanks for your question.
I am not sure what you mean by "does the amount still restricted under $12,000," but I think I can answer your question.
The gift will be valued at fair market value as of the date of the gift. If it is in excess of $12,000 you will have to file a gift tax return, but it is not likely that any tax will be due as there is a lifetime $1,000,000 exemption above the $12,000 annual amount.
His basis in the gift will be the same basis you have in it. He will not owe any tax until he sells the assets in the plan. Tax will be due on the gain, which is the excess of proceeds from the sale over basis.
