Legal Question in Tax Law in California
gift tax question ?
my wife sold a movie actors memorbilia in 2015 for 130000. she recieved it in 1974 from her employer.
do we need to get an apprisal for 1974 and pay tax on the difference ? dollartimes.com has $1. in 1974 = $5.08 in 2015. or do the gift reciepient not pay any tax.?
1 Answer from Attorneys
You must pay tax on the sales price less the cost basis to the transferor if it was received as a gift. If you are unable to determine the transferors basis as a gift, you will likely have no basis, and have to pay tax on th eentire amount. The value in 1974 at the time of transfer is irrelevant.
If it was treated as salary to the recipient, rather than as a gift, and income tax was paid on it in 1974, the basis would be the amount the tax was paid on it in 1974.
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