Legacy Holdings in Taxable Account – Podcast #86

Podcast #86 Show Notes: Legacy Holdings in Taxable Account

A listener emailed me recently who is lucky enough to get a generous gift every year from her grandparents of $14,000 in stocks. The stock is all from a single company that her grandfather worked for decades ago. Because he bought it early in the companies history it’s basis is $0, meaning that she is on the hook for capital gains tax for anything she sells it for. The stock does relatively well and pays out good dividends. However, she doesn’t love the risk of owning so much in one stock. She wanted to know what I thought she should do. Is the risk of keeping the stock outweighed by the tax penalty of selling the stock? Is there a way to convert this stock to a safer index fund without having to pay the capital gains tax? We are not all so fortunate to have relatives that gift us so much in stocks but it is still a question that I get every now and then so I wanted to address what to do with individual stocks in your taxable account, the pros and cons of selling them vs keeping them as a legacy holding in your portfolio.

In This Show:

This episode is sponsored by Bob Bhayani at Doctor Disability Quotes.com . They are a truly independent provider of disability insurance planning solutions to the medical community nation wide. Bob specializes in working with residents and fellows early in their

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