This is good info Coleen3! I hope you are sill around! (But, I must say, the more I read it the more confused get, LOL)
Our situation is a bit complex and I'm trying to fit it into your bullet points but need more direction, if possible.
Wife's aunt bought house decades ago for $A. Made my wife JTWROS on her house in 2006. Aunt passed in 2021. We sold the house just under 6 mos later for $B.
You mention 'adjusted cost basis to donor just before time of gifting'. I assume making one JTWROS is treated as 'gifting'? We did get a formal look-back FMV appraisal for the date made JT for figuring the donor's cost basis, which I believe is then halved with my wife, as JT, correct?
Then, effectively, the deceased donor's 'gain' is wiped out since 1/2 the sale price is the same as 1/2 the adjusted cost basis, since we sold the home within 6 months of the aunt passing and we understand that we can use that sale value as the FMV at the DOD. (Pls correct if wrong.)
And finally, my wife's taxable gain is only the difference in 1/2 of the sale price, minus 1/2 of the adjusted cost basis at the time of the donation, correct?
I hope that's all clear enough. I guess I'm looking for confirmation on how I'm figuring all this. Thx in advance!
