Should you give a gift of stock?

You might want to consider giving a gift of stock. You'd be giving a present that has the potential to grow in value over the years, and not many gifts can offer that. It's easy to give a gift of stock, through your brokerage account, directly with a share transfer, or from the company itself.

How do you gift stock?

Shares can be gifted via brokerage accounts, through specialist online apps, or, in some cases, directly from the company. If the stock you choose exceeds your budget, consider buying fractional shares instead. Gifting stock may be subject to gift tax and will trigger a taxable event when the recipient eventually decides to sell.

Do you pay tax on gifting stock?

From a tax perspective, there are generally two federal taxes to worry about when gifting stock: gift taxes and capital gains taxes. For the most part, the person who gives the property (i.e., the donor) pays the gift tax, while the person receiving the gift pays the capital gains tax.