Question: I hope you can tell me how to handle a capital gain situation. Over a period of years my husband and I accumulated more than 100 shares of a stock, a few shares at a time. The certificates were issued in both names as joint tenants with right of survivorship. My husband died in 1980 and I had a replacement certificate issued in my name only. Recently I sold the stock at a profit. How do I figure the capital gains tax? Is it based on the price of the stock when the replacement certificate was issued? Or must I go back as much as 25 years to determine the cost of each share?

Answer: First let's define the rule for determining capital gain: It is the proceeds from the sale minus the cost basis. You know how much you sold for, so the problem is the cost basis.

For the circumstances you describe, you must come up with two different cost figures--one for each half of the jointly owned shares. You owned half of all the shares from the time of acquisition; but you only owned the other half--the half that belonged to your husband--from the date of his death.

To determine the cost for the 50 percent you always owned, I'm afraid you must go back to the original purchase date for each block of shares. Take half the cost of each individual purchase and half the number of shares.

For the other half--the shares your husband owned--you can forget about the original cost; and the value on the date of issue of the replacement certificate has no significance.

Instead, your cost basis for that half is the value of his shares on the date of your husband's death. (There is an alternate valuation date but I doubt if it was selected in your case.)

If an estate tax return was filed, use the value cited in that return for the shares. If no return was filed, any broker should be able to research the stock and give you the value on the date of death.

If that doesn't work, go to a main library and look up the stock in the market quotation pages of The Washington Post for the day following the date of death.

The cost basis for your shares, then, is the total of the original cost of half of the shares plus the value of the other half on the date of your husband's death. And the capital gain is the difference between that total and the sale proceeds.

Q: Dividends in certain public utilities that are reinvested in stock are tax-deferred up to $750 per individual ($1,500 for married filing jointly). Will these dividends be subject to the new 10 percent withholding on July 1?

A: No. A specific provision in the Tax Equity and Fiscal Responsibility Act (TEFRA) that levied the withholding requirement exempts dividends reinvested in a qualified utility reinvestment plan.

There are also other exemptions in the act, such as capital gain dividends from a regulated investment company (mutual fund), interest on tax-free securities issued by a local government and income accumulating in an IRA or Keogh plan.

And one more exemption may be of interest: withholding is not required on an obligation of a "natural person" (as distinguished from an institution or corporation), such as the last time you borrowed 45,000 from your brother-in-law.

Tax tip: Here's a situation that arises once in a while. Husband and wife make several joint quarterly payments of estimated tax. Then before the end of the year they separate, and plan on filing separate income tax returns. What happens to the estimate payments?

Answer: The couple, now "uncoupled," can divide the total paid any way they wish: 50--50, all to one spouse and none to the other, or split in any other proportion. The only requirement is that the total claimed on both individual returns must equal the total estimated tax paid during the year.

The reverse circumstance is also possible. A man and woman each file separate estimates, then marry before Dec. 31. On their joint return, they should show the combined total of all payments made by both spouses.