US Stocks Tax Query
Hi Everyone,
I’m planning to invest in US stocks in my mother’s and wife’s names. The primary reason, of course, is taxation. Since gains on investments held for less than 24 months are taxed at the applicable slab rate, my own slab is already exhausted, whereas neither my mother nor my wife currently has any income.
To execute this, I’m considering opening a separate bank and demat/brokerage accounts in their names and investing through those accounts.
My question is: Could this arrangement create any tax-related issues for me or for them? If yes, how would the tax authorities potentially view such an arrangement? For example, could the income/gains still be attributed to me under any clubbing, beneficial ownership, gift, or other provisions?
I’d really appreciate it if someone could explain the implications in detail, including any potential pitfalls I should be aware of.
P.S. I’ve done some basic research using AI, and my initial understanding is that there shouldn’t be a problem, but I’d like to hear from someone knowledgeable before proceeding.