[abuk]

I received 5000 shares of stock as a gift. I recently sold these shares paying me $200,000. What kind of taxes should I expect to pay. 15% or 28% or something else

[ebaines]

If you held the stock for more than a year you pay tax on the capital gain at the long term rate, which could be 5% or 15%, depending on your tax bracket (this assumes that the stock is not for a "qualified" small business, in which case the tax rates range up to 28%). If you held the stock for less than a year, you will pay tax on the gain at the ordinary income rate.

You will need to determine the tax basis for this stock to determine if you have a capital gain or not. The tax basis for stocks received as a gift is either the basis that the person who gave you the stock had at the time he gifted it to you, or the fair market value (FMV) on the date you received the stock - it all depends on whether the FMV is greater or less than the donor's tax basis, and also whether you realized a gain or loss on the sale. Details and examples for determining the tax basis on gifted property are here:

Publication 551 (5/2002), Basis of Assets

[AtlantaTaxExpert]

Agreed!