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From:  George
Date:  Sun, 2 Jan 2000

What are the procedures for "stepped up value" on real estate where there are actual cost records available, and are there any IRS forms for this purpose?

Thanks.

Answer

Date:  January 2000

Hello George,

There is no IRS form relating to "stepped up basis."

The closest thing is the Federal Estate Tax Return, Form 706. The values of assets reported on this form are usually also the stepped up values for the assets.

Assets representing "income with respect of a decedent" are not eligible for a basis step up. An example would be U.S. savings bonds.

You should probably consult with a professional tax advisor about how to apply these rules for the assets you are dealing with.

Good luck!
Mike Gray

We have more answers to frequently asked real estate tax questions! We also offer up-to-date information about new tax real estate tax developments in Michael Gray, CPA's Real Estate Tax Letter.

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