In: Accounting
Under the IRC, a taxpayer who inherits property gets an automatic,
income-tax-free, step-up in basis for that asset. That is,
the heir uses the property’s value on the deceased’s date of death
(or 6 months later in some cases) as their basis for depreciation
and for gains/losses. This tax giveaway almost seems too good
to be true for estate planning purposes.
So, why would Congress give taxpayers such a generous break?
What was their motivation?
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