topic I have a gifted shock at FMV of $1800 and sold the same at $6000, I am using stock split 2 in 1. what will be by gain or loss of stock and purchase cost. in Investors & landlords

I have a gifted shock at FMV of $1800 and sold the same at $6000, I am using stock split 2 in 1. what will be by gain or loss of stock and purchase cost.

patelru021714 — Tue, 04 Jun 2019 21:48:19 GMT

Since you sold the stock at a gain over its FMV at the ti...

TomD8 — Tue, 04 Jun 2019 21:48:20 GMT

Since you sold the stock at a gain over its FMV at the time of the gift, your cost basis is the donor's original cost basis (called the "carryover basis") in the stock.

So, in order to determine your taxable capital gain, you need to know the donor's original cost basis (their original purchase price plus any commission).

This means that even though the cost basis is less than t...

patelru021714 — Tue, 04 Jun 2019 21:48:22 GMT

This means that even though the cost basis is less than the FMV when it was gifted, so we need to calculate gain or loss on that. but what if their is stock split 2 in 1. the same concept applies

Stock splits don't affect your overall basis in the stock...

TomYoung — Tue, 04 Jun 2019 21:48:23 GMT

Stock splits don't affect your overall basis in the stock.

Example:

You have 100 shares with a per share basis of $10.  100 x $10 = $1,000
Stock splits 2 for 1.
You have 200 shares with a per share basis of $5.  200 x $5 = $1,000

It doesn't matter that the shares have split. Capital ga...

TomD8 — Tue, 04 Jun 2019 21:48:28 GMT

It doesn't matter that the shares have split. Capital gain (or loss) is based on the dollar amounts, not the number of shares.

ok. now i got it. thanks

patelru021714 — Tue, 04 Jun 2019 21:48:29 GMT

ok. now i got it. thanks