Our situation is similar in that my husband's father and step-mother had a Irrevocable Trust. The family condo was purchased by them for $450,000 and then his father died in 1985. His step-mother lived in the condo until she died and it recently sold for $1.6 M. Ater the cost of the condo sale, the net is approximately $1. 5M. Accordingly to the trust, his stepsisters receive 50% and the other 50% is divided between my husband and his 2 siblings. Is there a step-up for my husband and his siblings or not, i.e. will each only have $75,000 tax free and then they will have to pay capital gains on the remainder of their distribution of the net proceeds? Thank you
