Give Your Daughter $100,000 of Apple Stock Now and She Can Sell It at 0% in the Year She’s Between Jobs. Leave It to Her Instead and the Step-Up Erases the Gain Entirely, and the Crossover Comes Down to One Number
Two tax rules point a mother toward opposite choices when she wants to hand her daughter a six-figure stock position, and the wrong move could cost thousands of dollars that a single calendar date would have erased entirely.
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A 66-year-old widow bought shares of Apple (NASDAQ:AAPL | AAPL Price Prediction) in November 2016 at a split-adjusted $25.02. Ten years later the stock trades at $352.64, a 1309.61% gain. Her position is now worth $100,000.
Her 34-year-old daughter was laid off at the end of 2025 and has earned nothing in 2026. She starts a new job in January. The mother wants to help now, and she keeps hearing two pieces of advice that point in opposite directions: give the stock while her daughter’s income is zero, or hold it so her daughter inherits it tax-free.
Both pieces of advice are correct. The winner depends on how much gain sits inside the shares, and the cheaper version of the gift expires on December 31.
Two Basis Rules Decide Who Pays
A gift brings the giver’s tax history with it. Under 26 U.S.C. § 1015(a), the daughter’s basis is “the same as it would be in the hands of the donor”, which is her mother’s $25.02 a share. Under 26 U.S.C. § 1223(2), her mother’s holding period carries over too, so any sale counts as long-term from day one.
An inheritance starts the basis over. 26 U.S.C. § 1014(a)(1) sets an heir’s basis at fair market value on the date of death. For income tax purposes, every dollar of appreciation before that date goes away.
Making the gift costs the mother nothing. The 2026 annual exclusion is $19,000 per recipient. The remaining $81,000 goes on Form 709 and reduces her lifetime exclusion, which is $15,000,000 for 2026. No gift tax is owed unless she has already used up that exclusion.
A $92,905 Gain Meets $65,550 of Zero-Rate Room
At $352.64, $100,000 buys about 283.58 shares. At $25.02 a share, the mother’s total basis is about $7,095, which leaves an embedded gain of $92,904.95.
Filing as single, the daughter has no other 2026 income. The standard deduction of $16,100 covers the first piece of gain. After that, singles pay the 0% rate on taxable income up to $49,450. Together, those two figures let her realize $65,550 of long-term gain at a 0% federal rate.
The other $27,354.95 of gain falls into the 15% bracket, topping out at $545,500 for single filers. If she sells every share in 2026, she owes $4,103.24 in federal tax and keeps $95,896.76. Most states add their own income tax on top.
Selling 200 Shares Cuts the Federal Bill to Zero
One change makes the gift work much better. In December, the daughter sells about 200.08 shares. That raises roughly $70,556 and realizes exactly $65,550 of gain, all of it taxed at 0%. She keeps the remaining shares, worth about $29,444, and their gain stays deferred. Her 2026 federal tax on the sale comes to zero.
The inheritance path wipes out the full $92,904.95, plus any growth between now and the mother’s death. The cost is timing: the daughter waits, and the money shows up on her mother’s schedule rather than her own. Federal estate tax plays no role here. Estates under the 2026 exclusion owe none, and of the 7,195 estate tax returns from 2024, only 2,663 owed any net estate tax.
Giving and Inheriting Break Even at $34,450 of Basis
Giving beats waiting clearly when the entire gain fits inside the zero-rate room. A single filer with no other 2026 income has $65,550 of that room. So a $100,000 position with a basis of at least $34,450 can change hands and be sold with no federal tax at all. With a lower basis, each extra dollar of gain is taxed at 15%, and only the step-up wipes it out.
The mother’s $7,095 basis falls far short of that line, which is why splitting the sale matters so much in her case.
Five Moves to Make Before December 31
- Get the cost-basis report for each tax lot from the brokerage. The daughter takes over those figures along with the shares.
- Add up every dollar of the daughter’s 2026 income, including severance, unemployment benefits, and interest. Each dollar reduces the $65,550 of zero-rate room.
- Move the shares in kind into an account in the daughter’s name before anything is sold. If the mother sells first, the gain lands on her own return.
- File Form 709 by the April 2027 deadline to report the $81,000 above the annual exclusion.
- If the mother’s health is declining, hold the shares instead. A step-up on the whole position beats a partial 0% sale.
Your estate tax attorney or CPA can run these numbers against your family’s actual returns.
Remember $65,550. That is how much long-term gain a single filer with no other income can take at 0% federal in 2026. Gain above that amount is taxed at 15% if she sells it, unless the shares pass through the estate and the step-up wipes out it.
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Vilma Rios is a tax professional, tax researcher, and financial writer with more than 15 years of experience in tax and accounting. Her work spans federal tax research, financial journalism, retirement planning, investment taxation, capital gains, inherited assets, and tax education. She specializes in translating complex tax and financial topics into clear, practical information that helps individuals, families, retirees, and investors make informed decisions.
She has presented tax information through webinars, including Spanish-language tax education, and has appeared on Telemundo 47 discussing tax topics and helping viewers understand important tax-filing requirements.
Her experience also includes tax and accounting work, tax research, IRS-related matters, and public tax education. While in college, Vilma volunteered in an IRS-sponsored tax assistance program and was recognized for her community service by local and state officials.
Known as "Your Tax Geek," Vilma is passionate about making taxes easier to understand and helping people navigate an increasingly complex tax system.
