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I'm Anne. I've been preparing taxes for 27 years and I'll be happy to help you.
Code 1014a states that the basis of inherited property is the Fair Market Value on the date of the death of the decedent, or if the executor makes the election, 6 months after the date of death by making the election (IRS Code Section 2032)
In the case of a surviving spouse, the spouse will inherit 1/2 of the property at Fair Market Value, and retains their cost basis in the other half.
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