@Member_Nine12 , just to clarify a little of what @Anonymous_ is saying with an example:
(a) Husband and wife owned a house which they had bought for 100,000. They ;live in a non-community prop state
(b) Husband passed , left the house to the wife, and on the day of his demise the house has an FMV of 200,000
(c) Wife's basis in the house is now 150,000 ( her 50 plus his 50 augmented by his step-up half the gain = 100)
(d)Now wife decides to co-own the prop with her two children on a 10, 45,45 basis and in a revocable trust.
(e) five years later she decided to sell ( the children agree to this )
(f) With no improvements etc. the basis split between the parties is as follows -- mother -- 15,000, the two children each with 67,500.
(g)If the property netted 300,000 after allowable expenses, the gains would mother -- 30,000 less 15,000 = 15,000; each of the children 135,000 less 67,500 = 67,500 and will be taxed on this gain.
Does this make sense ?
@Anonymous_
