| BUSINESSWEEK ONLINE : AUGUST 9, 1999 ISSUE | ||||||||
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| BUSINESSWEEK INVESTOR
How It Works Say you bought 6,300 Microsoft shares in December, 1994, at $7 each. If the stock were at $100, your holdings would be worth $5 million. If you sold 20%, or $1 million worth, you'd pay $200,000 in federal capital-gains taxes, plus any state levies. Here's how to diversify and avoid the immediate gains: -- Take the 20% of your shares and contribute them to an exchange fund. In return, you get an interest in a diversified stock portfolio and pay no capital-gains taxes. -- Your fund ownership equals the amount you contributed. So if the fund has $100 million in assets, your $1 million in Microsoft shares gives you a 1% interest. -- After seven years, you can withdraw your portion of the fund. DATA: BESSEMER TRUST CO. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ |
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RELATED ITEMS Exchange Funds: Time to Swap 'n' Save? TABLE: How It Works INTERACT E-Mail to Business Week Online | |||
