Tax consequences of stock transfer. . .?

Question

I plan to give about $10,000 worth of Pepsi stocks to my daughter. whenever she sells it, she pays the capital gains tax or do I pay it?

Answer 1

IRS pub 551.

If the stock has gone up in value, she uses your basis.  She pays the capital gains tax when she sells.

Depending on her age and other income when she sells, she may be subject to the kiddie tax rules.  This means *she* pays either her or your capital gains rate (whichever is higher) on *her* 1040.

Starting 2008, kiddie tax rules can go up to age 23.