Complicated? traded car for stock???

[FranieM]

Stock sold by broker in NY, check cashed in MS. I bought daughter a great car and she sold gift to minor stock ( approx 15,000+) and gave it to me. I was custodian and started account with a couple thousand here and there in ?? 1979??. Daughter 31 now. I have always prepared my taxes but How in the world am I supposed to figure out losses, gains, ups and downs over 30 years? OR really over 13 years since she shouldn't be taxed prior to age 18??? I was told, however, that after daughter receives a 1099 from broker, she could fill out a 1099 to me so that she is not burdened by the tax issue...She is still a struggling student. Does anything I have written make sense. I have a CPA but can't get in touch with him. Months back, he told me not to worry.. Any pointers would be appreciated..Thanks for reading!!!

 

[Zigner]

Stock sold by broker in NY, check cashed in MS. I bought daughter a great car and she sold gift to minor stock ( approx 15,000+) and gave it to me. I was custodian and started account with a couple thousand here and there in ?? 1979??. Daughter 31 now. I have always prepared my taxes but How in the world am I supposed to figure out losses, gains, ups and downs over 30 years? OR really over 13 years since she shouldn't be taxed prior to age 18??? I was told, however, that after daughter receives a 1099 from broker, she could fill out a 1099 to me so that she is not burdened by the tax issue...She is still a struggling student. Does anything I have written make sense. I have a CPA but can't get in touch with him. Months back, he told me not to worry.. Any pointers would be appreciated..Thanks for reading!!!

I would suggest you find a CPA that you CAN get in touch with.

 

[tranquility]

I have always prepared my taxes but How in the world am I supposed to figure out losses, gains, ups and downs over 30 years?

The records you are required to keep by law?

 

[Kiawah]

Your note is very confusing.

If you started a custodial account for your daughter years ago, it would have had her SSN attached to it. The money you put in, were gifts, and as long as were under the annual gift allowance, wouldn't have been taxable. The value of those gifts, would be the cost basis of the stock that was purchased.

Those stocks would most likely have spit off dividends each year, and potentially interest earned as well, and you may have had stock sales/mergers over the years. They should have been reported on your daughters income taxes for each year, although we don't know how much total income she had.

She has now sold that stock. The cost basis of that stock can be gotten from the records of your transactions when you made the purchases (couple thousand here, couple thousand there). On her tax form this year, she would fill out schedule D for capital gains, listing the date of sale, the amount sold for, the dates of purchase, and the amount of purchase. The difference, is her capital gains on the sale.

I don't understand the $15K and car purchase, so I don't know whether she bought the car, or you bought the car and gifted it to her, and she gifted you $15K (which is over the annual gift allowance of $13K). Who signed the purchase agreement, and how was the car titled?

Get to a CPA.

 

[LdiJ]

You don't necessarily need a CPA, and many CPA's are not experienced in individual income tax. Many of them focus on corporate tax.

The first thing that you need to do is figure out what you originally paid for the stocks...what you originally invested.

If you can come up with those numbers, then its relatively easy to figure out her capital gain.

Figure out what you initially invested and then go see an experienced tax professional. I don't think that this is going to turn out to be a major deal unless you attempt to handle it without professional help.

The first thing that you need to do is look at your daughter's end of the year brokerage statement for 2010. There is a chance that the cost basis is shown there..

 

[davew128]

You don't necessarily need a CPA, and many CPA's are not experienced in individual income tax. Many of them focus on corporate tax.

Won't disagree there. Wholly OT, but you would be surprised at the number of unenrolled preparers and EA's who have no idea how to an entity return either, if the number of corporate returns given to me on an outsourced basis with only P&L's is any indication.

The first thing that you need to do is look at your daughter's end of the year brokerage statement for 2010. There is a chance that the cost basis is shown there..

Agree but speaking solely as an adult and not a tax professional, why is the THIRTY-ONE year old daughter not handling her own matters?

 

[LdiJ]

Won't disagree there. Wholly OT, but you would be surprised at the number of unenrolled preparers and EA's who have no idea how to an entity return either, if the number of corporate returns given to me on an outsourced basis with only P&L's is any indication.

I don't disagree at all. Each professional has their own "focus". My point was simply that a good number of CPAs focus on corporate tax therefore they are not always the best choice for individual tax issues. A person might have to spend extra money paying for a CPA's research time, when a professional focused on individual tax might not need to research.

Agree but speaking solely as an adult and not a tax professional, why is the THIRTY-ONE year old daughter not handling her own matters?

Maybe because daddy made the situation more complicated by insisting on handling it in a way that made it more complicated, tax-wise...LOL...and now feels responsible to "fix" it. Since daddy is the one who made the initial investments while his child was a minor, it was certainly his responsibility to track the cost basis during that time period.

And yeah, I have cleaned up a lot of messes myself made by tax professionals who attempted to handle entity returns when they didn't know what they were doing.