The approaching holiday means people are now thinking of what to give family and friends. Giving gifts is a universal behavior. Many people don’t even need a special occasion or reason to give gifts.
Finding the perfect gift can be a challenge though. Most appreciate gifts of chocolates, books, and wine. Money and gift cards are also very welcome. But have you ever considered gifting someone with a stock or two?
Stocks are great gifts no matter the occasion. You can give them as a wedding or graduation gift. You can also give them to a charity or other worthy organization.
There are also many benefits to giving shares as a birthday or holiday present. Your gift’s value can grow over time. The recipient will enjoy the gains from the share’s price. Some might not have to pay a capital gains tax if they decide to sell their shares.
It’s also a sensible move on your end. If you play your cards right, you don’t have to worry about paying taxes with your stock transfers. Here’s how to transfer stock tax free.
Do a Virtual Transfer
One of the easiest ways to gift shares is to do a virtual transfer. This is possible if the recipient has their own brokerage account. You will need some basic details, like their personal and account information. You can request your stock transfer agent to do a direct transfer to another brokerage. It can help you avoid paying capital gains taxes.
A shareholder can transfer shares they own. Another option is to buy them using their account and then transfer the shares. There are even brokers who offer the option of gifting stocks.
Present Them with a Share Certificate
Presenting a loved one with a gift is one of the joys of life. So is tearing the wrapper off a present. You might not be able to do this if you want to present a loved one with a share certificate. You’ll have to buy shares and request a physical certificate.
Both the giver and recipient will need to make some effort as well. The owner has to sign a physical stock certificate to transfer it. This is always done in front of a stock agency broker or a bank representative.
Give It as an Anniversary Present
Is your anniversary coming up? Break away from tradition and gift your partner with shares. There aren’t any tax implications when gifting a spouse or partner with stocks. As long as you’re both U.S. citizens. You have the option of giving them the shares’ present or future interest. This means the recipient can receive the shares at that moment. They could also receive it at a specific date in the future.
Is your partner not a US citizen? That’s not an issue. There’s an annual gift tax exclusion. You won’t become taxed as long as your gift doesn’t cost more than $159,000.
Create a Custodial Account
Stocks can also be a great gift for children. It can get them interested in stocks. It can further their education in finances. What’s more, it can help them in the future.
You can create a custodial brokerage account for your children as a gift. You can then transfer mutual funds, shares, and other assets into it. Your child will then take ownership of it once they reach a certain age.
Watch out for the “kiddie tax” though. The IRS levies this if the account’s interest and dividend income goes over $2,300. When this happens, the account becomes taxable at your tax rate.
Gift It to a Worthy Charity
Stocks are gifts that keep on giving. This is something that can benefit a worthwhile charity. You can gift an organization with shares. But they must have the set-up to receive this type of gift. You won’t have to pay capital gains taxes for this either. The charity group won’t need to worry about it as well since they’re a tax-exempt entity.
Providing the Best Stock Service Solutions
Every expanding company has to consider shares and securities. You can make things easier for yourself with the help of Legacy Stock Transfer, Inc. We’re a family-owned full-service stock transfer agency. We’ve been an industry leader for over 20 years. We offer a deep understanding of stock transfer problems and solutions. We combine the latest technology with a people-centered team. The result is first-rate services at affordable prices. We offer stock transfer agent services. We can issue stock certificates. We can also replace lost or stolen certificates. We’re registered with the SEC. We’re also authorized for DRS and DWAC. You can reach us here or at 972-612-4120.