''If I give stock worth $8,000 to my son, who pays the capital-gains tax?''
By Writer: Holly Wheelwright Reporter associate: Jersey Gilbert

(MONEY Magazine) – Q. I have a 30-year, $110,000 mortgage at 9% on my house. I want to increase the principal payments during the next 20 years before I retire. Can I simply make bigger payments without renegotiating the loan? ALFRED M. JACOCKS JR. Virginia Beach, Va. A. You can make extra payments on principal of any amount you wish. Your mortgage agreement will tell you if your bank charges any fee for prepayment. Be sure to pay the additional amount by separate check and attach a note specifying that the money is a principal payment.

Q. I want to give stock worth $8,000 to my son. The securities have doubled in value since I bought them 10 years ago. What is the cost basis for calculating gain on the stocks, and who pays the tax?

HELEN MORGAN Nashwauk, Minn. A. If the stocks are in your son's name when they are sold, then he must pay tax on the gain, using your cost basis. If he plans to sell the stock immediately, and his tax bracket is higher than yours, it might be better for you to sell the stock, pay the tax and give him the proceeds.

Q. Under the old tax law, I was required to take interest from tax-exempt state and municipal bonds into account when calculating whether any of my Social Security benefits are taxable. Do I have to do this under the new law? LEONARD R. MICHELSON Freeport, N.Y. A. Yes. In making the calculation, you must add up your tax-free interest income, your adjusted gross income and 50% of your Social Security benefits. If the total exceeds $25,000 and you are a single taxpayer, or $32,000 if you are married and filing jointly, as much as 50% of your benefits will be taxable.

Q. In the late 1950s, then Senator John F. Kennedy personally autographed a copy of his book Profiles in Courage for me while I was visiting his office. How much is the book worth, and how do I sell it? BEN L. BROWN Monclova, Ohio A. You could get anywhere from $750 to $1,000 for your book, depending on its condition. John F. Kennedy's signatures are relatively rare because almost all were made by an autopen or a secretary, according to Neale Lanigan, director of the autograph department at the W. Graham Arader III Gallery in Philadelphia. You will get the best price by selling the book directly to a collector. You can advertise in publications such as the Autograph Collector Magazine (P.O. Box 55328, Stockton, Calif. 95205; $3 for 25 words or less, 15 cents for each additional word) or the Pen and Quill (Universal Autograph Collector's Club, 2621 S.W. 66th Terrace, Miramar, Fla. 33023; $15 for a year's subscription with one free ad).

Q. After I signed up for my company's new 401(k) plan in 1986, the managers said they do not have to tell me where my money is invested. Is this true? PIETER TERWILLEGER New York City A. Maybe. Qualified company savings plans, including 401(k)s, with fewer than 100 members do not have to include information on investments in their financial reports to members and the government. Further, these reports need only be made every three years. If the plan has more than 100 members, however, its report must include the investments. The report must also be made annually, but it can be issued as late as seven months after the end of the plan's fiscal year. Two months after each report is issued, the administrators must distribute a summary to all participants.

Q. I am a federal employee with eight years of service and plan to retire in 25 years. This year I must decide whether to remain in the Civil Service Retirement System (CSRS) or switch to the new Federal Employees' Retirement System (FERS). The CSRS seems to have a better annuity, but FERS offers a thrift plan with matching contributions from the government. Which plan should I choose? RANDOLPH FLYNN Walhalla, N.D. A. There is no easy answer. In general, FERS may be more attractive to employees with salaries less than $10,000 who have at least 10 years until retirement, says Lavon Strong of Manna Financial Planning Corp. in Fairfax, Va., a firm specializing in advising government employees. Other factors that you will have to take into consideration include the length of your government service and your Social Security benefits. You can ask the personnel department of your agency for help. Or you can get a computer analysis by mail from one of several private firms that assist government employees in choosing between CSRS and FERS. Two such firms are Sort Inc. (10090 Main St., Fairfax, Va. 22031; 703-352-5655) and Federal Personnel Publications Inc. (PIPS, P.O. Box 4777, Falls Church, Va. 22044; 703-532-1631). Both charge $32 for the analysis.