medium · Certified Financial Planner General Principles
An individual in the Calder household receives a gift of stock from a parent. The donor's basis was 50 per share, and the fair market value (FMV) on the date of the gift was 40 per share. The recipient eventually sells the stock for 44 per share.
What is the tax consequence of this sale?
- No gain or loss is recognized on the transaction.
- A capital loss of 10 per share based on the original purchase price.
- A short-term capital loss of 6 per share.
- A long-term capital gain of 4 per share.
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