If we Inherited 120 acres, selling off 10 acres. Does the Estate pay that step-up or do we need to assign that part of the property to one of us and they pay the step-up?

[jeeppadre89]

Once again, I appreciate all input on this. My concern is that the buyer was renting only 2 of the 10 acres and the other 8 acres he's wanting to purchase has been previously appraised and taxed as agriculture which is much less then residential, do not know that amount at this time.  So, I'm thinking there will be a step up if only due to the classification of the additional property, I could be wrong though.

[M-MTax]

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@jeeppadre89 wrote:

.. I'm thinking there will be a step up if only due to the classification of the additional property...

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There will be a step up, regardless of classification or use on the date of death, neither of which enters into the fair market value calculation.

You can secure the services of a certified real estate appraiser to do a date of death appraisal to resolve any ambiguity on that issue.

[NCperson]

@jeeppadre89 very simple: do you have an appraisal based on the date of death?  without that, everyone is just guessing.

When did the death occur? 

Suggetion - go out an find an appraiser who can tell you what this land was worth as of the date of death.  Without that, the capital gains consequences is unknown.  

the tax value has nothing to do with this.  It's the market value that matters.