The holiday season has just come to an end but the holiday gift of the year is something most would not expect. Approximately 65% of Americans would rather stocks or financial investments as a gift rather than what has been the norm up until today.
A survey was done on the topic and a quarter of the individuals involved in the survey said that they prefer to be gifted a financial investment and not a gift card. Even people that have over the years received stocking suffers in celebration of the holiday would rather have a gift related to a financial asset.
The senior director of content at LendingTree Ismat Mangla has shared her view on the topic. She said, “I think people are thinking about money, for better or for worse.” She went on “There’s nothing quite like a gift that’s going to continue to grow in value.” She elaborated that even due to several Corona outbreaks the stock market has remained in good condition.
How to gift stocks?
In order to purchase a stock for children, parents need to go through the process of setting up their accounts. The account is often known as UTMA (Uniform Transfers to Minors Act) or UGMA (Uniform Gift to Minors Act). Via this account, they can purchase stocks for minors or children in their care. Once the child comes to the age of 18 or 21, they are given access to their account and are able to use the money.
In regards to gifting an adult or family member that already has an account set up the easiest way to go about this is to simply transfer shares to their account. In order to transfer shares, you must have their account information.
How to gift cryptocurrency?
Gifting cryptocurrency is also rather simple there are several companies that allow users to gift coins to other members. If the receiver does not yet have an account or digital wallet, companies like Coinbase, Binance, CashApp, and Robinhood allow users to send various coins to others, often via an email gift card. They’ll need to create one that can store the cryptocurrency in order to receive the gift. There is also the option to send only a portion of a coin being that one bitcoin is currently worth 47,000, which is expensive. Another option is to gift someone a digital wallet either with crypto included or without because a wallet is necessary to hold and track one’s assets.
Things to consider:
Whether gifting or donating stock there are things that you should consider. Gifting stocks to avoid paying capital gains taxes might be profitable, but it also implies that you’re passing on a possible tax to the person to whom you’re giving the stock. If the individual you’re giving to is in a lower tax band, though, this may be worthwhile. They may be subject to a 0% capital gains tax if their income is on the lower side.
You must also submit additional documentation with the IRS if you provide more than $15,000 per year in gifts, including stocks. If you’ve given more than the current maximum of $11.7 million, you may be subject to a gift tax. A financial adviser can assist you with the process of donating stocks and other assets if you want to make the most of it.
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