Abner gives his daughter,Melissa,stock (basis of $50,000;fair market value of $44,000).No gift tax is paid.If Melissa subsequently sells the stock for $53,000,what is her recognized gain or loss?

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Melissa's basis is the same as Abner's basis, which is $50,000. Since the fair market value at the time of the gift was only $44,000, Melissa has a basis of $44,000 to use when calculating the gain or loss on the sale. The sale price of $53,000 minus the basis of $44,000 gives a recognized gain of $9,000. However, since Melissa did not receive any taxable gifts, there is no gift tax to consider.

Abner Gives His Daughter,Melissa,stock (Basis of $50,000;fair Market Value of $44,000).No