Welcome Guest. Register Now!  



Reply
 
LinkBack Thread Tools Search this Thread Display Modes
  #1 (permalink)  
Old 01-26-2007, 01:35 PM
Junior Member
 
Join Date: Jan 2007
Posts: 6
I Sold inherited stock! How do I calculate my basis?

I sold inherited stock in 2006 and it seems that I cannot get a good answer on how to calculate the gain or loss on sale of this stock.

I received the stock in 2003 when the value of the stock at time it was inherited was 15,000.

When I sold the stock, it was worth $32,000.

What is my reportable gain?



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
  #2 (permalink)  
Old 01-28-2007, 11:53 AM
TaxGuru's Avatar
Tax Guru
 
Join Date: Jan 2007
Location: New Jersey, USA
Posts: 2,417
Blog Entries: 3
Since you inherited the stock in 2003 and assuming the Estate Adminstrator elected to use the valuation date that calculated the basis of your stock at $15,000, this effectively becomes your basis for tax purposes.

IRS has special rules for assigning valuation for inherited property. In fact, for you despite your basis is $0 dollars, you get a stepped up basis, to $15,000 and save paying taxes on $15,000 of capital gain.

Amir, you are one of the lucky taxpayers that the IRS has given a tax break for your situation. Your reportable gain is therefore $17,000 of long term gains!!

__________________
Find a CPA near you!

Ask TaxGuru Please refer to the legal disclaimer.


Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
Ads
Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Follow us on Facebook Follow us on Twitter Google Buzz Rss Feeds

» Categories
 
Individual
 » Income
 » IRA/Sep
 » Medical
 
Corporations
 » Payroll
 
Forum for CPAs
 
Financial Planning
 
 
 

» Recent Tax Q&A
No Threads to Display.