My wife received a gift of just over 8,000 dollars in stock from the company owned by her Father. She turned around and immediately sold it to her brother for the same amount. Our tax preparer says because it was a family gift and under 10,000 dollars, we don't need to report it to the IRS on our tax return.

What do you folks think?

“ Our tax preparer says because it was a family gift and under 10,000 dollars, we don't need to report it to the IRS on our tax return. “---->It depends; gifting stock shares has tax implications for the giver and the recipient. If the stock has appreciated in value since it was purchased, her father, the donor, giving the gift is relieved of paying taxes on the capital gains, LTCG I guess.. On the other hand, he may have to pay a gift tax. However, as of Jan. 1, 2009, UNLESS you donate more than $13,000, including stock, to a person in a year you do not have to file a gift tax return, Form 709 with the IRS;the amount of annual gift tax exclusion for 2011 is $13K.So, the FMV of the stock, the gift, is LESS than $13K, her father doesn’t need to file Form 709.However, your wife may be subject to LTCG(as long as she keeps it for more than one year) on the LTCG as long as the selling price is higher than its original basis. In 2008–2012, the tax rate on qualified dividends and long term capital gains is 0% for those in the 10% and 15% income tax brackets. After 2012, the long-term capital gains tax rate will be 20% (10% for taxpayers in the 15% tax bracket).

Thanks for taking time to give me a detailed answer!