BulldogTom Posted March 11, 2015 Report Share Posted March 11, 2015 (edited) TP has a rental for many years. Fully depreciated under ACRS (remember that one). Has some improvements (new roof, new flooring) still on the depreciation schedule. Spouse passed away. Now I need to step up the basis. I have the new FMV of the whole home, but I am not sure how to put the difference in. I think I should add another line and call it "DOD Stepped Up Basis" and start depreciating it for another 27.5 years from the DOD. Is this the correct way to do it? Thanks Tom Newark, CA Edited March 11, 2015 by BulldogTom 2 Quote Link to comment Share on other sites More sharing options...
jklcpa Posted March 11, 2015 Report Share Posted March 11, 2015 Yes, that is what I would do. If you want a cite, I believe it's Reg. §1.1250-3(b )(2) 2 Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted March 11, 2015 Report Share Posted March 11, 2015 I agree, Tom, that's how I have done it in the past. Never had a problem with it. Just to clarify, Client gets a step-up in basis. How much depends on who owned the rental before. If the deceased solely owned it before, then client gets full step-up. If they jointly owned it, client gets step-up of the deceased's half. Quote Link to comment Share on other sites More sharing options...
michaelmars Posted March 12, 2015 Report Share Posted March 12, 2015 don't forget part of the step-up gets allocated to land. 2 Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted March 12, 2015 Author Report Share Posted March 12, 2015 don't forget part of the step-up gets allocated to land. Thanks for the reminder. Tom Newark, CA Quote Link to comment Share on other sites More sharing options...
Max W Posted March 12, 2015 Report Share Posted March 12, 2015 I agree, Tom, that's how I have done it in the past. Never had a problem with it. Just to clarify, Client gets a step-up in basis. How much depends on who owned the rental before. If the deceased solely owned it before, then client gets full step-up. If they jointly owned it, client gets step-up of the deceased's half. It only gets full step-up if it is titled WROS (with right of survivorship). JT (joint tenancy) does not. At least in CA. Quote Link to comment Share on other sites More sharing options...
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