I have a revocable trust that owns rental properties. The grantor is now deceased. I am filing a 2021 1041 reporting the rental income and depreciation using the step up in basis. The assets are distributed by the end of 2021. Do I record them as being disposed of? If yes, how? I am assuming that the beneficiaries also get a step up. How does that work with the 2021 depreciation?
Thank you!
