Harmoney Finance - Learn how Harmoney helps you save money on taxes, mortgage, and insurance

The best time to transfer assets to a child

By: Joseph A. Zielinski

Tax Break

Best time to give investments to a child or grandchild: A child age 14 or older may pay as little as 5% tax on long-term capital gain assets (such as stock shares)-compared with the 15% maximum. So giving such assets to a child to cash in may slash the family's tax bill on them. Snag: If the child hopes to obtain college financial aid, giving assets to him/her may cause a loss in eligibility for aid that exceeds any taxes saved. Timing: Give the assets after his second semester of the junior year of college-after the final college financial aid form has been filed.

Original Published date: Originally Published in Bottom Line Tax on Feb 10, 2006
Disclaimer: "The Bottom Line Publications publish the opinions of leading authorities in many fields. The use of these opinions is no substitute for professional services to suit your specific personal needs. Always consult a competent professional for answers to your specific questions."
Permission Statement: Reprinted with the permission of:
Boardroom, Inc. and Bottom Line Publications
281 Tresser Blvd.
Stamford, CT 06901
www.BottomLineSecrets.com