Sales of Farm Land

[lydia33]

I have a client that her husband died 3 years ago. She did not own the farm party in question. She inherited the property when he died. Does she get a stepped up basis for the property? I have to check with her to make sure that she owned no part of the parcel. If she did would she still get a step up basis for his half? She has sold the property in 2008.

[OldJack]

Assuming this was not in a community property state and that the farm was purchased before she married the husband, I would expect that she qualifies for fair-market-value basis as of the date of death.

[kcjenkins]

Yes, she gets a step up to FMV at DOD, on whatever share she inherited. So if she had no ownership before his death, she gets FMV on all of it. Also, if it's a community property state, she gets FMV on all of it. If she was on the title before he died, as a joint owner, she gets step up on his half.

[RoyDaleOne]

If the husband purchased the farm in 1977 or before, she also may get 100% stepped-up basis.