Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax
This answer was rated:

My father passed away in April 2017. He had an equity

Hi, My father passed away...
Hi, My father passed away in April 2017. He had an equity membership in Naples, Fl.( at an incorporated not-for-profit corporation-a country club). Membership was purchased for $35k in 1996. Subsequent mandatory assessments for clubhouse/golf course renovation over the last twenty years have totaled $33k. Upon membership transfer to a new member, the estate received $52k as the equity payment from the club and a 1099-misc for the $52k.
Would the estate be liable for federal income tax for all $52k, the "gain" of $17k or nothing at all, due to the accrued assessments added to the basis cost?
Show More
Show Less
Ask Your Own Tax Question
Answered in 18 minutes by:
2/23/2017
PDtax
PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4,730
Experience: 35 years tax experience, including four years at a Big 4 firm.
Verified

Hi from Just Answer. I'm PDtax, and can assist.

Ask Your Own Tax Question

There should be no tax due of any kind.

Upon your father's passing, his assets receive a step up in basis to fair market value at his date of death. This is typically used to value assets sold upon passing, creating a sale of asset for its (stepped up( basis, and $0 capital gain to the estate or to decedents.

This is the general rule. If the asset appreciated or depreciated between estate valuation and sale, that change would be taxable gain (or loss).

Thanks for asking at Just Answer. Positive feedback is appreciated when your questions are answered. Our rating scale (five stars) is the site's way to record users' opinions of our work.

I'm PDtax.

Ask Your Own Tax Question
Customer reply replied 9 months ago
Ok-so this would explained away as a zero net gain on a separate tax form of some kind? Is that correct? His estate has no other "income" from the time of his death in 2016 till now. The 1099-misc caught us off guard as it seemed like a reimbursement, not any kind of earned income. Just want to be able to explain that money in a way that will satisfy the IRS.
The estate reports the sale on form 1041, schedule D. Asset sold for 52k with 52k basis, no gain and cash to distribute.PDtax
Ask Your Own Tax Question
Customer reply replied 9 months ago
Ok, just so I'm clear-
For reporting purposes, "the basis" is based on the current membership cost OR the old membership cost+the assessments? I realize they both are equal to or higher than the 52k we received....just want to be accurate.
The basis is typically the fair market value. In your case, you have another option. Since the cost basis exceeds the fair market value, you could claim a loss.You could claim a capital loss for the 68-52, with the loss passing out to beneficiaries.PDtax
PDtax
PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4,730
Experience: 35 years tax experience, including four years at a Big 4 firm.
Verified
PDtax and 87 other Tax Specialists are ready to help you
Ask your own question now
Customer reply replied 9 months ago
Ok. Thank you
Ask PDtax Your Own Question
PDtax
PDtax
PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4,730
4,730 Satisfied Customers
Experience: 35 years tax experience, including four years at a Big 4 firm.

PDtax is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,300 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,336 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

13,906 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,651 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
Need help with filing of form 1041? Let Just Answer experts help.
I'm completing a 1041 form for my uncle's estate. He has 10 beneficiaries (5 are people, 5 are charities) each receiving 10%. I am claiming 50% of the income earned for the estate as a charitable dedu… read more
Charles Greiner
Charles Greiner
Owner
Bachelor's Degree
2,436 satisfied customers
I'm working to understand capital gains tax for California
I'm working to understand capital gains tax for California property purchased 4 years ago. It's a primary residence, purchased 4 years ago for $385k with $285k principle outstanding. Expected sale price of $630k … read more
abci168
abci168
Principal
27 satisfied customers
I owe the IRS $2340, for late reporting on form 1065, can I
I owe the IRS $2340, for late reporting on form 1065, can I just send them a partial payment and ask for installments if possible. thanks: Luis v Olivares Lodi, Ca … read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,251 satisfied customers
Is the sale of customer list a capital gain or ordinary income?
Is the sale of self-created intangibles, such customer lists, digital files, web sites, etc subject to capital gain or ordinary income treatment?… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Where do the attorneys' fees get reported? Box 7 or 14 in 1099 Misc?
Regarding Form 1099 Misc for attorneys. We paid an attorney filing fees for United States Citizenship and Immigration Services - these fees are as follows: I-29 filing fee H-1B (Training and Education… read more
Charles Greiner
Charles Greiner
Owner
Bachelor's Degree
2,436 satisfied customers
1099-R with distribution code 3. Can I get an earned income credit?
If someone receives a 1099-R with a distribution code 3, can they qualify for earned income credit? The person receives his pension because he became disabled.… read more
Bizhelp
Bizhelp
Certified Public Accountant (CPA)
Bachelor's Degree
638 satisfied customers
Tax question is there anyway to offset a capital gain of 60
Tax question is there anyway to offset a capital gain of 60 to 70k by buying another commercial property… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
A Form 1041 is filed for a Credit Shelter Trust & shows a
A Form 1041 is filed for a Credit Shelter Trust & shows a loss on the Taxable Income line (Page 1, line 22). Is this loss carried forward?… read more
abci168
abci168
Principal
27 satisfied customers
Form 1041 questions Where do you enter the 2k bond
Form 1041 questionsWhere do you enter the 2k bond premium-tax-exempt obligations on Form 1041. the 2k is shown on Form 1099-INT under Adjustments to interest and original issue discount… read more
keeperumiami
keeperumiami
Sr Financial & Tax Consultant
Bachelor\u0027s Degree
1 satisfied customers
I received a Schedule K-1 (Form 1041) from my aunt's estate
I received a Schedule K-1 (Form 1041) from my aunt's estate from which I received a distribution. In Part 3, Beneficiary's Share of Current Year Income, Deductions, Credits, and Other Items, there is … read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
842 satisfied customers
Do escrow shares for capital gains report the date they were
Do escrow shares for capital gains report the date they were issued or the date they became available to be sold… read more
abci168
abci168
Principal
27 satisfied customers
Us citizen living and working in colombia SA earned income
us citizen living and working in colombia SA earned income and unearned how do i report the interest and dividends are these tax at he same rate or can you also exclude them like the earned income … read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
842 satisfied customers
2016 FORM 1099 misc box 7. the company forgot to issue one
2016 FORM 1099 misc box 7. the company forgot to issue one more 1099-misc to contractor. the original 1099 and 1096 for other contractors had been mail out to IRS. so if we have to prepare this one ad… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,906 satisfied customers
FEDERAL INCOME TAX: A SINGLE WOMAN RECEIVES A 2016 FORM W-2
FEDERAL INCOME TAX: A SINGLE WOMAN RECEIVES A 2016 FORM W-2 FROM HER EMPLOYER WITH A TYPO IN THE SOCIAL SECURITY NUMBER. TO DATE THE EMPLOYER HAS NOT PROVIDED A "CORRECTED" FORM W-2. IS THERE AN IRS "… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,251 satisfied customers
Capital Gain - A taxpayer has capital loss (short term and
Capital Gain -A taxpayer has capital loss (short term and long term) carryover from stock sales. He also has loss carryover from rental property.When he sales the rental property, all the rental loss … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
US FEDERAL INCOME TAX. QUESTION: A SINGLE WOMAN OWNS A
US FEDERAL INCOME TAX. QUESTION: A SINGLE WOMAN OWNS A HOUSE, HER PRINCIPAL RESIDENCE, AND LIVES IN IT FOR 4 YEARS. IN 2017 SHE MARRIES A MAN WHO WILL ALSO USE IT AS HIS PRINCIPAL RESIDENCE BUT NOT HA… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,251 satisfied customers
THE irs STATED THAT TE TAXCALULATED ON SCHEDULE D WAS
tHE irs STATED THAT TE TAXCALULATED ON SCHEDULE D WAS INCORRECT . i CAN NOT ACCERSS dD. p;EASE DVISE HOW I CAN ACEESS THE SCHEDULE … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
I am a trustee for a deceased friend and have a form 1041
I am a trustee for a deceased friend and have a form 1041 Schedule K-1, beneficiary's share of income and deductions, credits, etc. Can this only be used to offset my interest and dividends? Or can it… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x