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Stephen G.
Stephen G., Financial Advisor
Category: Capital Gains and Losses
Satisfied Customers: 7197
Experience:  Senior Tax Expert; CPA/PFS(retired)Personal Financial Planner; Small Business & Professional Mergers & Acquisitions
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Sale of inherited property, capital gain tax issues?

Customer Question

Sale of inherited property, capital gain tax issues?
Submitted: 2 years ago.
Category: Capital Gains and Losses
Expert:  Stephen G. replied 2 years ago.

It depends upon a couple of main factors.

Date of death of decedent vs date of sale of property.

Fair market value of property verses sales price of property.

Any gain would be long term - automatically long-term for inherited property irrespective of holding period.

Generally if property sold withing 6 months - 1 year of Date of Death of decedent, FMV at DOD deemed to be same as selling price.

If IRA or other retirement account that would have been subject to income taxes if withdrawn by decedent, no "step-up" in tax basis & beneficiary will be taxed on receipt of funds as ordinary income. Other issues involved in dealing with decedent's retirement accounts.

No income tax on life insurance proceeds on life of decedent.

What are your specifics?

Steve G.