Selling stock. Paper not live cattle.

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kenny thomas

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15 years ago my 2 brothers and myself inherited a fairly significant amount of Kroger Grocery stock. I am the executor of the estate and for the last week i have been attempting to sell it. Thats been a headache of its own.
But my question is, im 67 and on Social Security. Im allowed to make approximately $60,000 a year before they start taking part of my SS away. $1 for every $2 made.
Is the profits from the stock considered as regular income where they will take everything i made this year from Social Security away. My share of the profit is going to be way above the $60,000 im allowed to make in wages.
 
15 years ago my 2 brothers and myself inherited a fairly significant amount of Kroger Grocery stock. I am the executor of the estate and for the last week i have been attempting to sell it. Thats been a headache of its own.
But my question is, im 67 and on Social Security. Im allowed to make approximately $60,000 a year before they start taking part of my SS away. $1 for every $2 made.
Is the profits from the stock considered as regular income where they will take everything i made this year from Social Security away. My share of the profit is going to be way above the $60,000 im allowed to make in wages.
I would talk with tax accountant in your state for that.
 
Oh im definitely going to do that. Just hoped some of the smart people on here had ran into this already. Gonna have to pay a lot of tax on the profits anyway but dont want to loose the SS also.
 
I've been looking into CD's
Apparently the income from those are taxable.

If ya find out more, let us know would ya?
Can you convert the money from the stocks into a Roth of some sort?
 
I've been looking into CD's
Apparently the income from those are taxable.

If ya find out more, let us know would ya?
Can you convert the money from the stocks into a Roth of some sort?
First thing i have to do is sell the stock and give my 2 brothers their share. Each will pay their part of the taxes. I expect that. But dont want to loose 20,000+- in SS also.
 
Thats a huge difference then. How about the SS part? Any ideas.

From my understanding capital gains don't effect SS benefit amount. But they will change how much of your SS benefits are taxable. It may be beneficial to sell the stock over a period of years to reduce the capital gains amount?

But that's just my vague understanding. A qualified tax professional will have the answers.
 
From my understanding capital gains don't effect SS benefit amount. But they will change how much of your SS benefits are taxable. It may be beneficial to sell the stock over a period of years to reduce the capital gains amount?

But that's just my vague understanding. A qualified tax professional will have the answers.
I would love to sell over several years but 2 brothers say they want to sell.
If it doesn't effect the SS benifit amount that will be great.
 
Is the stock in your name currently, the estate's name, or already split in 3 names?
Why do you have to sell it, just to disburse it to yourself and the 2 brothers?
Does your state not allow you to transfer ownership of it without first liquidating it? (The 3 of you 'might' have to pay inheritance taxes based on it's value now compared to what it was when purchased)
 
15 years ago my 2 brothers and myself inherited a fairly significant amount of Kroger Grocery stock. I am the executor of the estate and for the last week i have been attempting to sell it. Thats been a headache of its own.
But my question is, im 67 and on Social Security. Im allowed to make approximately $60,000 a year before they start taking part of my SS away. $1 for every $2 made.
Is the profits from the stock considered as regular income where they will take everything i made this year from Social Security away. My share of the profit is going to be way above the $60,000 im allowed to make in wages.
My neighbor got his clock cleaned on Medicare premiums as well on a stock sale.
Talk with your CPA it might be beneficial to set up a trust.
 
CPA for sure and maybe estate attorney

Should be long term capital gains but may get interesting on value. Hopefully its from inherited date.

Can the estate not transfer equal shares to each of yall? Then each person can do what they want?

I would hold it until 70 or take it in smaller pieces.
 
I'm no lawyer or tax professional. You can sell the stock & distribute the money OR transfer stock ownership. Is there a will or a transfer-on-death beneficiary? I would transfer ownership for now and figure out when to sell later. I would work with the brokerage to split/transfer ownership. Soon as your brothers receive ownership they will be able to sell their shares. Stock proceeds are capital gains - 1040 Schedule D and form 8949.
 
You can get some info and ideas here, but you need a professional to get the truth. Here is what I think I know. Different states have different rules for probate and estates, but the Federal tax issue is the same everywhere. I was the executor for my mother's estate recently. Cash and real estate split up to the heirs. The cost basis is the estimated/appraised value of the asset at time of estate settlement. I assume that was 15 years ago for you. For stock, there is no estimated/appraised value since there was a defined stock price on the day the estate was settled and assets distributed. So federal taxes would be based on long term capital gains - selling price minus value at time of distribution.

In regard to tax on SS benefits, here is the IRS rule (I think you will owe taxes on 85% of your SS benefits, at whatever tax bracket you are in):

FROM THE IRS: You will pay tax on your Social Security benefits based on Internal Revenue Service (IRS) rules if you:
  • File a federal tax return as an "individual" and your combined income*is
    • Between $25,000 and $34,000, you may have to pay income tax on up to 50% of your benefits.
    • More than $34,000, up to 85% of your benefits may be taxable.
  • File a joint return, and you and your spouse have a combined income*that is
    • Between $32,000 and $44,000, you may have to pay income tax on up to 50% of your benefits.
    • More than $44,000, up to 85% of your benefits may be taxable.
  • Are married and file a separate tax return, you probably will pay taxes on your benefits.

* Your adjusted gross income
+ Nontaxable interest
+ ½ of your Social Security benefits
= Your "combined income"
 
You can get some info and ideas here, but you need a professional to get the truth. Here is what I think I know. Different states have different rules for probate and estates, but the Federal tax issue is the same everywhere. I was the executor for my mother's estate recently. Cash and real estate split up to the heirs. The cost basis is the estimated/appraised value of the asset at time of estate settlement. I assume that was 15 years ago for you. For stock, there is no estimated/appraised value since there was a defined stock price on the day the estate was settled and assets distributed. So federal taxes would be based on long term capital gains - selling price minus value at time of distribution.

In regard to tax on SS benefits, here is the IRS rule (I think you will owe taxes on 85% of your SS benefits, at whatever tax bracket you are in):

FROM THE IRS: You will pay tax on your Social Security benefits based on Internal Revenue Service (IRS) rules if you:
  • File a federal tax return as an "individual" and your combined income*is
    • Between $25,000 and $34,000, you may have to pay income tax on up to 50% of your benefits.
    • More than $34,000, up to 85% of your benefits may be taxable.
  • File a joint return, and you and your spouse have a combined income*that is
    • Between $32,000 and $44,000, you may have to pay income tax on up to 50% of your benefits.
    • More than $44,000, up to 85% of your benefits may be taxable.
  • Are married and file a separate tax return, you probably will pay taxes on your benefits.

* Your adjusted gross income
+ Nontaxable interest
+ ½ of your Social Security benefits
= Your "combined income"
Actually the stock is still in the estate so this will be the settlement.
@simme Might be enough left over to buy my next bull.
 
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