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If I give property that has gone up in value to my child and then my child sells it, who pays tax on the gain?
It depends on your child’s age and whether he is a full-time student. If your child is under the age of 19 or a dependent full-time student under age 24, any gain over $1,800 in 2008 and $1,900 in 2009 is taxed at your rate -- which is probably higher than your child’s tax rate. However, if you’ve held the asset longer than one year, the tax on the gain, especially if the gain is large, will probably be the same for you as it would be for your children.Children who provide more than half of their own support are not affected by the "kiddie tax."Return to Questions
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