Gifting stock

[Macdude357]

If I gift some stock to my adult son, I realize that the gift is irrevocable, however, is there any reason my son could choose to gift back the proceeds so long as they are within the gift limits?

[xmasbaby0]

What are you trying to accomplish?

[Macdude357]

He is going to school in Texas and needs medical insurance. I live in California and am on ACA so he doesn’t get coverage in Texas.  In order to qualify for ACA in Texas his income must be at least $13700.  He doesn’t make that much so I was going to gift some stock that has appreciated so when he sells it he will have a capital gain that counts towards ACA income.  

[Mike9241 · Accepted solution]

yes the IRS could choose to ignore the gift and tax you on the sale because gifting the money back would look like the principal purpose was improper and possibly illegal tax avoidance not a true gift.  In other words in the end you would be in the same position, ignoring income taxes, as if you sold the stock yourself.