Tax Law (Questions About Taxes)/Bequeathment


Dear Mr. McConnaughy:
When our mother passed away in 2012, she left to my brother and myself a sum of money invested in a DWS mutual fund. When she was living,we were all three listed as joint tenants in common. and we used the dividends from the mutual fund to augment her social security. Upon her passing, my brother agreed that we would re-register the account as joint tenants but giving my social security number so that I could draw the monthly dividends until we decided to sell. I have been doing just that until we noticed the fund price begin to go south a few months ago and the dividend shrinking. We both agreed to liquidate the fund. I asked shareholder services to split it equally and send each of us a check for half.  However, they said that they couldn't do that - they could only send the full amount to the address of the soccial security number on record, which was me. After it arrived in my account, I cut a check for half of it to my brother.  I don't want to pay taxes on the full amount, so my brother checked with his CPA who said that there will be a place on my tax return for me to say that half the amount will be claimed on another person's tax return.  First question:  Is this correct and, if so, where is it on my return and what are the particulars for properly doing it?  Second question: Aside from the dividends that I collected since May of 2012 which I know how to handle, how is the principal that was left to us, and that we split evenly, taxed - as a straight bequeathment or do we, in some way, have to determine how much it has grown in value since original purchase? (The purchase was originally made with mom's money when we were young tykes, not ours - and we have no record of the original purchase price unless the mutual fund does)  Many thanks for your help!  ------ James

the point being more appropriately, didnt you pay tax on the income and dividends over the last few years?

Just report the income on your return and figure out the net and give it to brother to settle the account. and get a waiver when you pay him.  things sometimes have a way of turning out funny.

you need your own representation. and need to get it right.  

just my two cents

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Tax and general business including hospitality related (hotel mgmt degree and experience in industry prior to obtaining ms tax and cpa).


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