@NCperson: ....and everyone should understand that not investing has its risks (generally, in the form of inflation eating away at their savings, and there is absolutely no tax adjustment for that loss).
With respect to net losses resulting in loss carryovers and step-downs, taxpayers have the ability to ameliorate that situation with tax planning (at least to a certain extent) and investing wisely. For example, it would be hard to imagine something like a stock index fund that was purchased by a decedent many years ago getting anything other than a step-up today.
