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HI96821
Returning Member

Step up in basis

Need help.

 

Dad passed and need to know whether my mom can take 100% step up in basis of investment accounts.  

 

My mom was a homemaker and did not contribute to the investment accounts.  Is she eligible to take 100% step up in basis?  

 

They do not live in a community property state.

 

Thanks 

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3 Replies

Step up in basis


@HI96821 wrote:

My mom was a homemaker and did not contribute to the investment accounts.  Is she eligible to take 100% step up in basis?  


Yes, per Section 1014 of the tax code, the basis of the property held by your father (now in your mother's hands) is stepped up to the fair market value on the date of his death.

 

Note, however, that if the investment accounts were held jointly by your mother and father, then one-half would receive a stepped-up basis. 

HI96821
Returning Member

Step up in basis

she is a joint account holder for all taxable accounts but she contributed 0%.  Per Pub 551, isn't she eligible to receive 100% step up in the basis?

Step up in basis


@HI96821 wrote:

she is a joint account holder for all taxable accounts but she contributed 0%.  Per Pub 551, isn't she eligible to receive 100% step up in the basis?


No, that would only be applicable in a community property state. Otherwise, only your father's share would receive a step up in basis (i.e., your mother "inherited" one-half of the accounts from your father, the decedent - she already owned the other half).

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