mikeruney
Level 1
03-14-2026
01:41 PM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
3 siblings inherited their mothers house valued at $90k
They decided to split it up evenly and turn it into a rental property, making the basis is $30k for each.
In 2025 one brother passed and the remaining siblings now own 50% each. The value of the property at his passing was $150k
They sold the property shortly after for $150k
Ignoring recaptured depreciation, land value for now, how do I increase the basis of the property per sibling reflecting the FMV of the home when the brother passed?
My calculations are:
30k original basis
50k FMV of Brother’s share at time of passing
25k inherited from brother’s share
55k new basis
Is there a way to increase the basis of the home asset entry, or do I make a new asset for 25k and call it “2025 Inherited Basis” then dispose of the asset at $0.00
Labels
Skylane
Level 12
03-14-2026
04:49 PM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
Enter the inherited stepped up basis of 25k for each remaining sibling as of the brothers DOD. Then show the disposition of the asset for each living sibling as their share of the proceeds on the date of sale… the software should handle the 4797 and sch D. Enter the gross amount of the 1099S on the 4797
If at first you don’t succeed…..find a workaround
TaxGuyBill
Level 15
03-14-2026
08:15 PM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
If there was to be any depreciation after the brother died, you would enter a second Asset Entry Worksheet to depreciate that stepped-up inherited portion.
If there wasn't to be any depreciation after the brother died, on the original Asset Entry Worksheet there is a line in the disposition section to enter the 'Basis, if different'.
