joint owner added to stocks
Have client who’s mother has individual stocks (dad passed away).
The stocks are all in Moms name.
The mother files taxes in VA.
She is not over the 5M Fed threshold.
a. Is it smart, for tax purposes or probate, to add a joint name (the daughter) or TOD, POD to the mothers stocks?
b. does it help out in anyway other than showing a death certificate and transferring the stock to the joint, TOD or POD owner?
thank you,
Douglas
Permalink Submitted by Alan - IRA critic on Thu, 2016-10-20 23:39
Other than avoiding probate, adding a joint tenant to the stocks does not affect the cost basis upon mother’s death. The cost basis is only affected by the gifting rules if the added person sells stock and keeps the proceeds (withdraws from the account). The shares withdrawn become current gifts (subject to annual gift exclusion) and basis rules for gifted assets. That includes no gifting of a loss if added person sells at a loss.