stephenandrew
Recycles dryer sheets
- Joined
- May 5, 2007
- Messages
- 148
Good morning--
I know an individual who wants to make a gift to his children. The bulk of his assets are in IRA's (traditional) and 401-K's. If he removes assets from the tax deferred accounts, I told him I believe he would have to pay ordinary income taxes on the assets he removes--he does not want to do this (no surprise there). He asked about the possibility of giving his kids shares in the mutual funds in his IRA's without liquidating them--e.g. just transfering the shares to them. I told him I did not think this would work--that it was still likely a taxable event since the shares were coming out of his tax deffered account. I said I knew of no way to avoid this tax hit.
Was I correct?
Thanks.
Thanks.
I know an individual who wants to make a gift to his children. The bulk of his assets are in IRA's (traditional) and 401-K's. If he removes assets from the tax deferred accounts, I told him I believe he would have to pay ordinary income taxes on the assets he removes--he does not want to do this (no surprise there). He asked about the possibility of giving his kids shares in the mutual funds in his IRA's without liquidating them--e.g. just transfering the shares to them. I told him I did not think this would work--that it was still likely a taxable event since the shares were coming out of his tax deffered account. I said I knew of no way to avoid this tax hit.
Was I correct?
Thanks.
Thanks.