Albuquerque Journal (Albuquerque, NM)

Figuring adjusted basis on inherited land.

Byline: Your Taxes PATRICA ELLIOTT For the Journal

Q. My mother died last July 20, and left land in Alabama to me and my brother. We have decided to sell the land. A Realtor in Alabama appraised it at between $30,000 and $32,000. It's being listed at $32,000.

I understand that the basis of inherited property is its fair market value at the date of death.

We recently received an offer of $28,000 for this land. I somehow have it in my mind that there is some sort of holding period on inherited property before you can claim a loss, but I can find nothing about this in any of the IRS publications.

My question is: If we were to accept this offer would we be able to claim a loss, and if so, how much?

A. Inherited property receives a stepped-up basis equal to the fair market value of the asset at the date of death of the owner. (There is an exception for property in an estate where the executor chooses an alternate valuation date six months subsequent to the date of death). …

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