Details to my knowledge:
1. Father in law (while married to mother in law, residing in KS/FL) purchased a vacation property in Germany for price A in 2008 - title solely in his name as far as I can tell, mother in law did not work/provide income.
2. Father in law passed away in 2018 (still married) leaving the property to my mother in law (both living in FL at the time), appraised at price B at that time
3.Mother in law gifted/transferred the property to my wife and her 3 sisters (25% each) around time of appraisal in 2018
4. Property sold in late 2022 for price C, proceeds split between the 4 sisters
Question 1- Am I correct in thinking the cost basis on the property is B (100% step up in basis at time of father in law's passing), and our capital gain would be .25 * (C - B) since it was in his name alone? Is there anything in this scenario that indicates I need to take original purchase price A into account and treat this as only a 50% step up in basis at the time of my father in law's death (i.e. it was purchased during the marriage so is somehow treated as a marital asset co-owned by mother in law regardless of title)? Neither FL or KS appear to be community property states, i do not see anything on the original purchase paperwork that indicates co-ownership or tenancy etc. but I received limited records from the family and they are also in German..
Question 2- all the above transactions/appraisals were conducted in Euro, from what I have gathered I convert each of those prices B & C (as well as A if I need to apply a 50% step up) into USD using exchange rate at the time of each respective transaction/appraisal when calculating my basis/proceeds/gain - correct?
