admin1 Posted January 5, 2020 Report Share Posted January 5, 2020 ADMINISTRATOR OF TRUST THAT FILES FORM 1041 CONTINUED RENTAL PROPERTY OPERATION AFTER DEATH OF ORIGINAL OWNER TO MID-YEAR THIS YEAR. STEPPED-UP BASIS WAS USED FOR DEPRECIATION ON 1041. THIS YEAR THE TRUST WAS CLOSED AND THE PROPERTY WAS DISTRIBUTED TO THE HEIR. FORM 706 WAS NOT REQUIRED. IF PROPERTY'S STEPPED UP BASIS WAS $500,000 (EXCLUDING LAND) AND ACCUMULATED DEPRECIATION WAS $16,666 AT DATE OF DISTRIBUTION, , DOES THE HEIR CONTINUE THE DEPRECIATION USING BOTH THE STEPPED-UP BASIS AND THE ACCUMULATED DEPRECIATION AND IS THE DISTRIBUTION DATE THE ACQUISITION DATE TO THE HEIR. KNOW AN HEIR IS SUPPOSE TO RECEIVE THE STEPPED-UP BASIS UPON DECEDENT'S DEATH, BUT IF PREVIOUSLY DEPRECIATED I THE TRUST, HOW DOES THAT WORK? Quote Link to comment Share on other sites More sharing options...
Max W Posted January 5, 2020 Report Share Posted January 5, 2020 Apparently it can be treated one of two ways by making, or foregoing, election 643(e)3. See para 4 of this link https://www.cpajournal.com/2017/09/29/tax-planning-distributions-kind-estates-trusts/ Quote Link to comment Share on other sites More sharing options...
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