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Tax Guy: How your loved ones can cash in on the 0% tax rate on long-term capital gains

After the Tax Cuts and Jobs Act (TCJA), many individual taxpayers still qualify for the 0% federal income tax rate on long-term capital gains and dividends. You read that right: 0%. Before you object that your income is way too high to benefit, remember that you may have children, grandchildren, or other loved ones who can take advantage. Here’s what you need to know.

Help loved ones to cash in on the 0% rate

While your income may be too high to benefit from the 0% rate, you may have children, grandchildren, or other loved ones who qualify. If so, consider giving them some appreciated stock or mutual fund shares that they can then sell and pay 0% federal income tax on the resulting long-term capital gains.

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