Will I Receive A Step-Up In Basis For This Inherited Property?

In most cases, there is a step-up in basis when property is transferred from a decedent. But there are a few exceptions and some subtle distinctions to keep in mind when a client inherits property.

To help make this analysis easier, we have created the “Will I Receive A Step-Up In Basis For This Inherited Property?” flowchart. It addresses some of the most common issues that arise for a client trying to understand their cost in property they inherited.  This flowchart considers:

  • Impact of living in a community property state
  • Types of property that receive a step-up
  • Impact of selecting the alternate valuation date
  • Simple ownership vs. JTWROS vs tenants in common

Updated 7/15/2020