To determine her loss, she needs to know her tax basis. When you give property, such as stock, the recipient’s tax basis used for determining gain or loss is usually your basis. More specifically, since the value of the property equaled or exceeded your basis at the time you gave it to your niece, her basis for determining loss is your basis (plus all or part of gift tax paid on the gift). If the stock had been worth less than your basis when you gave it to your niece, her basis for determining loss would be the date-of-gift value.
Payments within one tax year of the entire amount due to a participant in a qualified retirement plan. Qualifying lump sums may be directly rolled over tax free, or, in some cases, are eligible for current tax under a favorable averaging method.