Question about transferring stock - Tilted Forum Project Discussion Community

Grancey · 12-19-2010, 11:32 PM

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?

jigar · 12-20-2010, 01:31 AM

Quote:

Originally Posted by Grancey

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?

Logically and likely you should not have to pay cap gains tax - i assume not till you sell the stock - HE on the other hand might have to .. your countries laws may have a minimum holding time before you can sell without cap gains tax.

eribrav · 12-20-2010, 05:43 AM

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?

The_Jazz · 12-20-2010, 05:44 AM

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.

Baraka_Guru · 12-20-2010, 05:46 AM

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.

GreyWolf · 12-20-2010, 12:42 PM

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.

12-19-2010, 11:32 PM	#1 (permalink)
Grancey Life's short, gotta hurry... Location: land of pit vipers	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? __________________ Quiet, mild-mannered souls might just turn out to be roaring lions of two-fisted cool.

12-20-2010, 05:43 AM	#3 (permalink)
eribrav Junkie Location: upstate NY	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?

12-20-2010, 05:44 AM	#4 (permalink)
The_Jazz Asshole Administrator Location: Chicago	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. __________________ "They that can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety." - B. Franklin "There ought to be limits to freedom." - George W. Bush "We have met the enemy and he is us." - Pogo

12-20-2010, 05:46 AM	#5 (permalink)
Baraka_Guru warrior bodhisattva Super Moderator Location: East-central Canada	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. __________________ Knowing that death is certain and that the time of death is uncertain, what's the most important thing? —Bhikkhuni Pema Chödrön Humankind cannot bear very much reality. —From "Burnt Norton," Four Quartets (1936), T. S. Eliot

12-20-2010, 12:42 PM	#6 (permalink)
GreyWolf Sober Location: Eastern Canada	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. __________________ *The secret to great marksmanship is deciding what the target was AFTER you've shot.*