Thanks in advance for any help. I am wondering if my CPA is correct...
Background:
- My parents placed their house in a revocable trust (E.g. Mom and Dad Trust) decades ago. My Mom passed away at a later date, about 15 years ago. My Dad passed away in Dec.
- My Dad moved all his assets to a newly created trust (Dad Trust), except for the house
- Sold house a couple of months ago
- CPA says we have to calculate the capital gain (step-up in basis) from the time of my Mom's death.
- Grandchildren received a specified amount from the trust
- Remaining proceeds split between my sister and I
- CPA says my sister and I split the tax and the total amount of the taxable gain
Questions (after researching the internet)
1) Do not understand why the step-up in basis only goes to the date of my Mother's passing and not my Dad's. I thought we would be liable for any gain after the date of my Dad's passing?
2) Should improvements to the house, including a hole house generator, increase the basis? Our CPA says, "no"
3) Should the portion the grandchildren receive reduce the amount of our "capital gain"? The CPA says they have no tax liability because they received a "specified amount", and it foes not reduce the amount of the taxable gain that my sister and I are liable for. So essentially we are taxed on their inheritance
Any insight is greatly appreciated. The CPA is my Dad's long time CPA, so it ill be difficult if I decide to go with another CPA.
Thanks again for any help.
Background:
- My parents placed their house in a revocable trust (E.g. Mom and Dad Trust) decades ago. My Mom passed away at a later date, about 15 years ago. My Dad passed away in Dec.
- My Dad moved all his assets to a newly created trust (Dad Trust), except for the house
- Sold house a couple of months ago
- CPA says we have to calculate the capital gain (step-up in basis) from the time of my Mom's death.
- Grandchildren received a specified amount from the trust
- Remaining proceeds split between my sister and I
- CPA says my sister and I split the tax and the total amount of the taxable gain
Questions (after researching the internet)
1) Do not understand why the step-up in basis only goes to the date of my Mother's passing and not my Dad's. I thought we would be liable for any gain after the date of my Dad's passing?
2) Should improvements to the house, including a hole house generator, increase the basis? Our CPA says, "no"
3) Should the portion the grandchildren receive reduce the amount of our "capital gain"? The CPA says they have no tax liability because they received a "specified amount", and it foes not reduce the amount of the taxable gain that my sister and I are liable for. So essentially we are taxed on their inheritance
Any insight is greatly appreciated. The CPA is my Dad's long time CPA, so it ill be difficult if I decide to go with another CPA.
Thanks again for any help.
Statistics: Posted by AndyGordon — Wed Aug 21, 2024 11:26 am — Replies 3 — Views 98
