STOCK MOM AND SON

Hi,

I have a question for you. My husband and I have been married for 23 years. He is an only child and he and his mother have some joint stocks. Recently she and I had a falling out. She just informed him that she wants him to sign off the stocks because if something were to happen to him, she would have to pay the taxes on the stocks. Is this correct, or does she just want his name off, so I get nothing. I live in Pennsylvania. Thanks very much for your time.

Renee
-----------------------------------

Dear Renee,

If your husband signs away his interest in jointly held stock his mother would have to pay tax on any taxable event occurring while she has total ownership. Assuming there are no extenuating circumstances, she would wholly own the stock and become subject to tax when such stock was sold creating a capital gain.

If "something were to happen to him," Mom, in joint tenancy would have claim to all the stock. If both are authorized traders on a stock portfolio, either could sell the stock and have access to all the funds. Ethics and law may not be bed-partners after a family fallout. Check this immediately.

As tenants-in-common your husband's estate would be the logical heir.

Best advice:

Consider the emotional and economic impact of challenging the status quo. If the value of the stock is insignificant, one falling out after 23 years may be repairable and a family breakup avoided. If there are significant assets dividing the stock makes financial sense.

Keep the bigger picture in mind. Will Mom disinherit her son? What impact will befall the family? What about grandchildren? Holidays? Money can be replaced; families can not. Don't win a battle and lose a war.

When time is not critical, decide when the emotions have settled down. Otherwise, think quickly but wisely - and act.

Everybody's Uncle