Since a married couple with taxable income below $81k pays 12% on short term capital gains and a couple with over $329k in taxable income pays 32%, would it be legal tax avoidance or illegal tax evasion for that rich couple to sell something at their basis to that poor couple, have the poor couple sell it at market value, and then the poor couple gift the profit back to the rich couple (keeping the 12% they had to pay plus a couple more percent for their troubles)?
To put some numbers to it:
Rich couple has property worth $100,000 market value. Their basis in the property is $60,000. Poor couple has $40,000 in taxable income. Rich couple sells poor couple the property for $60k. Rich couple has no tax implications because they made no money. Poor couple sells the property for its market value and has $40k in ST capital gains. They are taxed at 12% on that gain. They pay the $4,800 in taxes, keep $1,000 for themselves, and then give $34,200 to the rich couple. The rich couple ends up with $94,200 for their $100,000 property. Had they sold it themselves, after taxes, they would have ended up with $87,200 ($60k + $40k gain minus 32% of $40k).
If this is legal, are there services out there that set this up? I assume real property would be too volatile to do it with considering how long it takes for transactions to go through and the unknown exact market value. But can it be done with stocks where the transaction takes place fast enough that the market value is known?