I need help on this tax problem for homework

[Goldy1]

person received a gift of 1000 ACE stock with a FMV of 100,000 from her mom. She also received $4000 of cash dividends from the ACE corp. The dividends are qualified div.

she also received a regular stock dividend (non taxable under sec 305) of 50 shares of ACE stock with 5000 FMV.

What and where would I put on the 1040 or other schedule sheets (and what schedule would I put them on)

thanks

(I did the whole mock tax return but stuck on this one part after looking almost an hour)

[jIM_Ohio]

try turbo tax or something like that
not sure

[BadSaver]

The gift of stock is not taxable (to the receiver) and therefore would not go on the tax return. When the receiver of the stock sells the stock it will go on Schedule D. The person giving the stock gift has to report it, and maybe pay taxes, if it's over a certain limit. I'm not going to get into that here as I don't think your working on the giving end of the transaction because it is sort of complicated.

Look on the front of the 1040, there's a line there for dividends. When the stock dividend was paid, it should have a FMV in the problem you are working on?

[Goldy1]

thank you

* Received a regular stock dividend (nontaxable under section 305) of 50 shares of Ace Corporation stock with a $5000 FMV.

The question is stated above like this.... ( I was wondering if anything needs to be added on a schedule or on the dividend line in the 1040 form) It threw me for a loop when it said it was nontaxable under section 305. If I do have to put it on the form, would it be $5000?

Thanks again for you input....

[BadSaver]

Stock Dividend

I think the stock dividends will not be taxable until the stock is sold so you won't have to report it until then. So they won't be reported unless somewhere in your project it says they were sold. The $4,000 in CASH dividends will go on the dividend line of the 1040. Hope this helps...

[Goldy1]

yes it does help. Thanks