Determining Cost Basis on TOD property

[Jodiesfam]

My brother and I received property via a Transfer on Death deed, legal in our state. We did not have the property appraised when my mother died, in November 2022.  The county assessment for 2022 is about $50,000 less than the 2023 appraisal.  Is there a good way to determine what our cost basis would be as we sold the property in May 2023?

[JulieS]

Yes, the basis is the fair market value (FMV) on the date of death, unless an estate has established an alternate valuation date. 

County assessments are usually less than FMV, so that is not a good source for the basis. Some counties will also provide a market value, so check the information they have listed carefully. 

You can check with a local realtor to get an opinion of the value. If you used a realtor for the sale last year, you could contact them and ask them for their opinion of the value in 2022. 

[Jodiesfam]

Thanks for the quick response.  To add to the scenario, pretty much all my mother had was the house/property, so no estate as such.  We sold the property directly to a builder without going through a realtor, 7 months after my mother's death.  The house has since been demolished and a new house has been built on the property.  What would be your best recommendation for getting a cost basis now?  

Thank you!

[tagteam · Accepted solution]

You can get a date of death appraisal from a certified real estate appraiser or a CMA from a local real estate broker (the two should be relatively close).

Either one can typically go back through the records and use comparable properties to formulate a valuation for the property at that time.