1099 B Inherited Stocks

[BigBob0923]

I inherited a stock in 2023 from my father. In 2024 it merged with another company and it's ticker changed. In 2025 the company merged again and I was paid out shares. TT is asking me if I inherited the stock and I'm thinking I want to say yes because the date acquired is in 2021 (when my father was the owner). Thoughts? Thank you. 

[Bsch4477]

The date acquired is inherited and the cost basis is the value on the date of the decedent’s death. 

[JamesG1 · Accepted solution]

Yes, it was inherited.

If you inherited a stock, the cost basis is likely the value of the stock on the date of the decedent's death.

As an example, you inherited stock A.  The deceased purchased the stock share at $5.  The stock price on the date of death was $30.  You are allowed to use this number as your adjusted cost basis.

If you sold the share at $50, you would have a $20 long-term gain on the sale.  You pay taxes on the $20 gain.

Per IRS Publication 551 page 15, the basis of property inherited from a decedent is generally one of the following.

1. The fair market value (FMV) of the property at the date of the individual's death.
2. The fair market value (FMV) on the alternate valuation date if the personal representative for the estate chooses to use alternate valuation. 
3. The value under the special-use valuation method for real property used in farming or a closely held business if chosen for estate tax purposes. 
4. The decedent's adjusted basis in land to the extent of the value excluded from the decedent's taxable estate as a qualified conservation easement.

@BigBob0923