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Question about transferring stock
Someone wants to buy something from me and pay for it by transferring some stock to me. Would I have to pay capital gains tax on this stock? Does anyone know how this would work?
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Be wary
Be very careful with this transaction.
Based on the question you just asked I would suggest not doing it at all. But for starters: Is the stock held in street name (a brokerage account) or does he have stock certificates? |
jigar is right - you should not have to pay any tax on this. You're swapping one asset for another. Now, if the stock grows, you'll have to pay tax on that at the appropriate time.
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If he wants it so bad, just tell him to cash out the stock and give you cash.
The alternative would be to take on the responsibility of doing background research on the stock to determine if it's a stock worth taking on (vs. cash). It sounds like he's being lazy and/or doesn't want to pay fees. |
I'm with Baraka_Guru... this looks more likely to be some sort of a minor scam, possibly to avoid taxes. If he's paying you in shares, he may still be liable for sales tax on the transaction. In addition, if what you are selling him is normal for you (to sell), you may have to claim the value of the stock as YOUR income. Too much downside for my liking.
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