Hello Carl,
Thanks for your detailed response to this question posted a few years ago.
I am going through a similar situation as the OP.
- Mom and dad owned a few rental properties in Hawaii in a trust, built years ago and fully depreciated
- As far as I know they each had a trust that jointly owned everything. We recently executed my dads trust which put everything into my moms trust.
- Dad died unexpectedly in late 2022, I took over helping with some of the property management and taxes.
- Filed taxes for 2022 with no update to depreciation and filed married / jointly for my parents since he was alive throughout the year
- Filed taxes for 2023 still with no update to depreciation tables. Had a hunch I should be doing something there but was pretty overwhelmed with the work and should have sought help earlier. It was surprisingly difficult for me to get tax help locally where we are in Hawaii
- Working on 2024 taxes and now realize my mom can geta step up in basis on at least 50% or 100% of the property. (It is not clear to me if Hawaii is a considered a community property state for the subject of restarting depreciation)
- Once I figure out how much step up in basis and restart depreciation is there a way to capture 2 years of depreciation for the lost year in 2023 that I did not capture or would I need to amend the prior years return?
Thanks so much for any help you may be able to provide!
