 |
|
|
|
patperry2766
Saginaw Texas
Senior Member
Joined: 07/27/2012
View Profile
Good Sam RV Club Member
 Offline
|
He (accountant) said there should be a step up at the time of his death because technically the trust should have been distributed then (confirmed on the IRS website). It wasn't until 2017 that the trust proceeds were distributed. The FMV of comparable land sales of similar size average $ 1868 an acre. I have an initial offer of about $2050 an acre now so it won't sting as much as we originally thought.
If I hold he land for less than a year before I sell it, the the price above the step up basis would be taxed as ordinary income bumping me up to 33% tax bracket. He said if I hold it at least a year, then it becomes capital gains and is only taxed at 20%.
How should the land be classified as a gift, inheritance or something other? I was never listed as a beneficiary of the trust, just my dad and any remaining siblings, but I am listed as a beneficiary on my dad's will.
* This post was
edited 01/13/18 04:07pm by patperry2766 *
Courage is the feeling you have right before you fully understand the situation
|
jalichty
Lander, Wyoming 82520
Senior Member
Joined: 09/18/2003
View Profile
Good Sam RV Club Member
Offline
|
If the land gets a step-up in basis due to the death, then you have long-term holding period on the day you get the land. Therefore, the gain would be long-term and taxed accordingly. I am not your accountant, but if the accountants says the basis gets stepped up on the distribution from the trust, then it is not a gift. If it's not a gift, but an inheritance, then your holding period is considered long-term when it comes out of the trust. Even if it was a gift, the holding period is long-term as long as the decedent owned it the requisite amount of time.
John A. Lichty
|
charlengifford
Chicago
New Member
Joined: 03/07/2022
View Profile
Offline
|
It seems to me that before making any serious decision related to your current situation, you should carefully and very carefully study 1031 exchange rules.
|
Seattle Steve
Tucson
Senior Member
Joined: 09/18/2010
View Profile
|
charlengifford wrote:It seems to me that before making any serious decision related to your current situation.
Since this thread is more than 4 years old, I seriously doubt that this "current situation" is really a current situation...
|
Moderator
Tennessee
Moderator
Joined: 01/19/2004
View Profile
|
Old thread. Closed.
|
|
|
|
|
|
|
|
