Message:

<p>[QUOTE=&quot;NorthKorea, post: 1658772, member: 29643&quot;]I disagree with the assessment as you presented it.</p><p><br /></p><p>Let&#039;s take this scenario to the extreme:</p><p><br /></p><p>Mother paid $49,995 for the coins from the US Mint. OP would much rather have $50,000 in cash than modern crap, so OP decides to sell the coins for $50,000 on CT.</p><p><br /></p><p>Assuming 2012 ($13,000) or 2013 ($14,000) exemptions change the scenario, so I&#039;ll assume 2013.</p><p><br /></p><p>$14,000 exemption means net gift tax exposure of $36,000, with $5 of that being due to an apparent increase in FMV, since the IRS would define FMV as the reasonable price that could be expected when the item is sold. Since the item was sold, in fact for a $5 profit, FMV would be $5 over basis. Assuming the maximum gift tax of 40% is somehow applicable, the total gift tax due to the IRS would be $14,400. Given that only $5 of the $36,000 was due to appreciation, we would see the OP&#039;s basis increase by $14,200, yielding a total basis of $64,195. That would mean a loss, and no taxes would be due on the $5 profit, but a LOT of paperwork, would be needed to establish that savings.</p><p><br /></p><p>A big part of the question is related to timing of everything.</p><p><br /></p><p>I don&#039;t think it&#039;s fair to use the mint.gov pricing as proof of basis, since the US Mint regularly changes its prices during the release year and the year following. (This isn&#039;t directed in response to the quote, but rather to another post in this thread.) As such, in absence of receipts, the IRS would apply the FMV rule based upon the assumption that the mother bought the coins at whatever would yield the lowest possible adjusted basis. Then, if the mother claimed the gift at current FMV, she&#039;d have access to her annual exemption for gifting.</p><p><br /></p><p>All in all, if the OP *really* wanted to, he could always claim the product was gifted to him at the moment of materialization of the sale. In that fashion, the basis would be FMV at the time of the gift, assuming the mother is willing to claim that she gave the gift at a value above her original basis and apply her annual exemption.</p><p><br /></p><p>THIS IS ALL HYPOTHETICAL. I&#039;M IN NO WAY, SHAPE OR FORM PROVIDING LEGAL, FINANCIAL OR TAX ADVICE.[/QUOTE]</p><p><br /></p>

Your name or email address:

Do you already have an account?

• No, create an account now.
• Yes, my password is:
• Forgot your password?

Stay logged in