Can I transfer my child's stock investments from my name to theirs without triggering taxes?

You have a few options here, but they each have different tax implications: 1) You could gift shares directly to your son. For 2025, the annual gift tax exclusion is $19,000 per person per recipient. So you and your wife together could gift $38,000 worth of shares per year without filing a gift tax return. Anything over that amount would require filing Form 709 (gift tax return), though you likely wouldn't owe actual tax since it would just count against your lifetime estate/gift tax exemption (which is quite high - over $13 million per person currently). 2) Your son receives your cost basis when you gift shares. This means when he eventually sells, he'll pay capital gains tax on the difference between the sale price and what you originally paid (not the value when gifted). So the tax isn't avoided, just deferred. 3) If you want to completely eliminate the capital gains tax on the appreciation so far, you could hold the assets until your death, at which point your son would inherit with a stepped-up basis (the fair market value at your death). Obviously not ideal for your situation! The simplest approach is probably the direct gift, understanding your son will eventually pay capital gains tax on the appreciation when he sells.

I was in a similar spot with my parents handling investments for me, and I found that taxr.ai really helped clarify our options. They have this feature where you upload statements and documents, and they analyze the specific tax implications for your situation. In my case, https://taxr.ai showed us exactly how to structure the transfer to minimize tax impact based on the specific securities we were dealing with. What I liked was getting a clear explanation of the basis transfer rules and gift tax exclusion limits that applied to our specific holdings - was much clearer than the general advice we were finding online that didn't account for our particular mix of stocks and timeline.

Just wanted to follow up about my experience with taxr.ai since I was skeptical in my earlier comment. I decided to try it with my own situation (inheriting stocks from my uncle) and was genuinely impressed. The system analyzed the specific securities and purchase dates and showed me that about 30% of the portfolio had much higher gains than the rest. This let me make a smarter decision about which shares to sell vs. transfer. What surprised me most was how it identified a small batch of shares that were actually slightly underwater, which my accountant had completely missed when looking at the overall portfolio value. Definitely gave me more nuanced information than I expected.

For anyone dealing with complicated tax questions like this, I had a really difficult time getting through to the IRS for specific guidance. After waiting on hold for hours across multiple days, I found this service called Claimyr that got me through to an actual IRS representative in about 15 minutes. You can check it out at https://claimyr.com or see how it works at https://youtu.be/_kiP6q8DX5c I was honestly about to give up on getting official clarity on some gift tax questions, but they somehow bypassed the hold system. The IRS agent I spoke with explained that in cases like yours, you should specifically request a "gift statement" from your brokerage that documents the transfer as a gift to ensure proper basis tracking.

I need to admit I was completely wrong about Claimyr in my skeptical comment above. After waiting on hold with the IRS for nearly 4 hours yesterday and getting disconnected, I decided to try it out of desperation. I figured it couldn't be worse than what I was already experiencing. To my genuine surprise, I was connected with an IRS representative in about 20 minutes. The agent was able to provide specific guidance on my multi-year gift question and confirmed the proper documentation needed. They even emailed me the relevant sections of the tax code that applied to my situation. I'm still shocked it actually worked after my repeated failed attempts to reach anyone at the IRS directly.

Your best option would probably be to use the annual gift tax exclusion over a few years. For 2025, the limit is $19,000 per person per year. So each parent can gift $19,000 to your son annually ($38,000 total) without filing gift tax paperwork. For $105k, you could do about 1/3 of the shares in 2025, another 1/3 in 2026, and the final third in 2027. This avoids paperwork and keeps everything clean from a tax perspective.

Has anyone considered setting up a trust instead? When my parents transferred investments to me, we used a trust structure that allowed them to maintain some control while legally establishing my ownership. Might be worth talking to an estate attorney about this option.

One thing to consider is the timing of when your son plans to sell these investments. Since he'll inherit your cost basis (what you originally paid ~14 years ago), he'll owe capital gains tax on the full appreciation when he sells. Given that the investments have grown from $9,000 to $105,000, that's potentially significant capital gains tax. If he's planning to hold these investments long-term anyway, the gift approach works well. But if he wants to liquidate soon after receiving them, you might want to factor in the tax impact on his side. Sometimes it makes sense to sell some positions while they're still in your names (especially if you're in a lower tax bracket) and gift the cash proceeds instead, depending on your respective tax situations. Also, make sure your brokerage can handle the transfer properly with correct basis reporting. Some brokers are better than others at tracking gifted securities and providing the right tax documents.

You're dealing with a common but tricky situation. The good news is that gifting stocks directly to your son won't trigger capital gains for you - it's not considered a taxable event for the giver. However, your son will inherit your original cost basis (around $9,000), so he'll owe capital gains tax on the full $96,000 appreciation when he eventually sells. Given the $105,000 value, you have two main paths: 1) **Spread it over 3 years**: Gift $38,000 worth of shares annually (you and your wife each using your $19,000 annual exclusion). This avoids any gift tax paperwork entirely. 2) **Transfer everything at once**: You'd need to file Form 709 for the amount over $38,000, but likely wouldn't owe actual gift tax unless you've already used up significant portions of your lifetime exemption ($13.99 million per person in 2025). Before deciding, definitely check what tax bracket your son is in for capital gains. If he's in a higher bracket than you are, it might actually be more tax-efficient to sell some of the most appreciated positions while they're still in your names, then gift the proceeds. This strategy works especially well if you're in the 0% or 15% long-term capital gains bracket. Also, make sure your brokerage can properly document the gift with correct basis reporting for future tax filings.