"What is basis date for son where mother gifts life estate to daughter, remainder to son?

[bfranks]

Mother dies. Daughter dies years later. Property is sold shortly after daughter's death. Is the basis date: date of gift? Date of mother's death? Date of daughter's death?"

[CathiM · Accepted solution]

The basis is the fair market value (FMV) at the date of the daughter's passing. This gives you a stepped up basis in the property. If the executor of the estate chooses to use the alternate valuation, the basis is the FMV of the property on the alternate valuation date, six months after the date of death.

[bfranks]

Thank you for the prompt help!  I sincerely appreciate your response!