Transfer ownership of common shares

[kcin]

Is it possible to transfer ownership of common shares to someone at arm's length without substantial implications?

Long story short as a condition of my new job I am not allowed to own shares in companies I cover. Some of my positions are currently way below water and were meant to be long-term holds. Therefore I really don't want to sell and realize a substantial loss if I don't have to.

What are the tax/legal implications of transferring my shares to my parents/business partner/random other person?

Any help would be greatly appreciated, thanks.

[bruizeman]

I didn't know your parents are "arms-length".

But you could get the actual certificates from your broker and then sign them over to your parents.

There are substantial fees to this however. (Something like $100-200 per certificate).

[asdfvcx]

It will be considered a deemed disposition. Meaning you would have considered to have sold the shares and crystallized your loss.


And on a separate note, you most likely will be violating the conditions of your job, since it's quite apparent you plan to remain in control of the shares. And depending on what your job entails, you may also be in violation of SEC rules or rules from similar bodies.

[kcin]

I figured it would be considered a disposition for tax purposes.

If I don't own the shares, how would I be considered to be in control of them or the net beneficiary?

[asdfvcx]

If I don't own the shares, how would I be considered to be in control of them or the net beneficiary?
Will you be in control of them? Will your be fine with your parents selling them and keeping all of the money without notifying you?


From a simple common sense standpoint, you would appear likely to have some control over the shares.

IS your employer going to adopt a "beyond reasonable doubt" standard when determining if the guidelines are being followed? Or are they more likely to adopt a "this looks fishy" standard? I'm guessing the latter.

[Icedawn]

the problem is that in all likelihood, there will be very similar tests for whether you're still "owning" the shares for SEC or whatever purposes... and whether there has been a deemed disposition.

if you satisfy the test for there to not be a deemed disposition, then you're likely still an "owner" for SEC or whatever purposes.

similarly, if you want to actually satisfy the SEC or whatever, you'll likely be found to have made a deemed disposition.

go ask a tax lawyer or something like that see if there's any wiggle room in the middle... someone that you can do to satisfy both... although it's probably quite unlikely.

[kcin]

I guess I'll have to talk to compliance and read up more.

Maybe they'll give me a break and not make me sell immediately.

If I did transfer the shares and realize a tax loss, would the ACB go to zero or the price at which I "sold" them at?

[ghostryder]

Long story short as a condition of my new job I am not allowed to own shares in companies I cover. Some of my positions are currently way below water and were meant to be long-term holds. Therefore I really don't want to sell and realize a substantial loss if I don't have to.



Is a blind trust not a option?

[dutchca]

I guess I'll have to talk to compliance and read up more.

Maybe they'll give me a break and not make me sell immediately.

If I did transfer the shares and realize a tax loss, would the ACB go to zero or the price at which I "sold" them at?

The ACB of the shares you transfer becomes the FMV on the day of the transfer.

[Jobu]

What if you transfer beneficial interest in the shares but retain registered ownership?