How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Rakhi Vasavada Your Own Question
Rakhi Vasavada
Rakhi Vasavada, Financial and Legal Consultant
Category: Finance
Satisfied Customers: 4433
Experience:  Graduated in law with Emphasis on Finance and have have been working in financial sector for over 12 Years
43581946
Type Your Finance Question Here...
Rakhi Vasavada is online now
A new question is answered every 9 seconds

wife inherited a life estate in residence from her husband

This answer was rated:

wife inherited a life estate in residence from her husband (who died in 2002). Wife was age 59. She has recently remarried, and she and her new husband are going to build a new residence. My question is whether her income tax basis is as it was fixed when age 59, or is her income tax basis at age 70 (her present age)? I know her sale is exempt from income tax, but the value of life estate affects the taxable portion for her children, who are the remaindermen.

rakhivasavada :

If you inherited property from a decedent who died before 2010, your basis in property you inherit from a decedent is generally one of the following and one of them is The FMV of the property at the date of the decedent's death.


The FMV -- is Fair Market Value.

rakhivasavada :

Therefore, in your case, the basis of the property would be fixed (at FMV) as of 2002, i.e. when she was 59 and not present time.

rakhivasavada :

The following IRS link deals with this.

http://www.irs.gov/publications/p17/ch13.html#en_US_2012_publink1000172221

rakhivasavada :

I am sure this would help...

You may please leave a positive rating if this helps as that is the only way we receive credit for assisting you. Alternatively feel absolutely free to revert with more queries if you have.

Warm Regards...

Rakhi Vasavada and other Finance Specialists are ready to help you