Capital Gain Holding Period

[dbquicken]

When a spouse dies in a community property state, and the basis of stock investments in stepped up, does the original purchase date determine if a gain/loss is long-term or short-term? Or is it the date of the step up in basis?

[pk]

@dbquicken , the step-up is only to the basis.  The holding period  does not get a change.   The real reason behind the step-up is to allow  free inheritance. if the asset is sold   soon after the inheritance event.

Does this make sense ?